Martinez Company’s relevant range of production is 9,500 units to 14,500 units.
ID: 410788 • Letter: M
Question
Martinez Company’s relevant range of production is 9,500 units to 14,500 units. When it produces and sells 12,000 units, its unit costs are as follows:
If 10,000 units are produced, what is the average fixed manufacturing cost per unit produced? (Round your answer to 2 decimal places.)
If 14,500 units are produced, what is the average fixed manufacturing cost per unit produced? (Round your answer to 2 decimal places.)
If 10,000 units are produced, what is the total amount of manufacturing overhead cost incurred to support this level of production?
If 10,000 units are produced, what is the total amount of manufacturing overhead cost expressed on a per unit basis? (Round your answer to 2 decimal places.)
If 14,500 units are produced, what is the total amount of manufacturing overhead cost incurred to support this level of production?
If 14,500 units are produced, what is the total amount of manufacturing overhead cost expressed on a per unit basis? (Round your answer to 2 decimal places.)
If the selling price is $21.40 per unit, what is the contribution margin per unit sold? (Round your answer to 2 decimal places.)
If 13,000 units are produced, what are the total amount of direct manufacturing costs incurred to support this level of production?
If 13,000 units are produced, what are the total amount of indirect manufacturing costs incurred to support this level of production?
What total incremental cost will Martinez incur if it increases production from 12,000 to 12,001 units? (Round your answer to 2 decimal places.)
Martinez Company’s relevant range of production is 9,500 units to 14,500 units. When it produces and sells 12,000 units, its unit costs are as follows:
Explanation / Answer
Solution:-
1-If 10,000 units are produced, what is the total amount of manufacturing overhead cost incurred to support this level of production? If 10,000 units are produced, what is the total amount of manufacturing overhead cost expressed on a per unit basis? (Round your answer to 2 decimal places.)
Variable manufacturing cost = $1.60= 10,000*1.60 =$16,000
Fixed Manufacturing overhead cost = $3.40 = 12,000*3.40 = $40,800
Total manufacturing overhead cost = $56,800
If 10,000 units are produced, What is this total amount expressed on a per unit basis? (Round your answer to 2 decimal places.)
Total manufacturing overhead cost = $56,800
Manufacturing overhead per unit = 56,800/10,000 = $5.68
2-If 14,500 units are produced, what is the total amount of manufacturing overhead cost incurred to support this level of production? If 14,500 units are produced, what is the total amount of manufacturing overhead cost incurred to support this level of production?
Variable manufacturing cost = $1.60= 14,500*1.60 =$23,200
Fixed Manufacturing overhead cost = $3.40 = 12,000*3.40 = $40,800
Total manufacturing overhead cost = $64,000
Manufacturing overhead per unit = 64,000/14,5000 = $4.41
If 14,500 units are produced, what is the total amount of manufacturing overhead cost incurred to support this level of production?
Total manufacturing overhead cost = $64,000
3-If the selling price is $21.40 per unit, what is the contribution margin per unit sold? (Round your answer to 2 decimal places.)
Direct materials = $5.40
Direct labor = $ 2.90
Variable manufacturing overhead = $1.60
Sales commissions = $1.10
Variable administrative expenses = $0.55
Variable cost per unit = $11.55
Selling price per unit = 21.50
Less:
Variable cost per unit = $11.55
Contribution margin per unit = $9.95
4-If 13,000 units are produced, what are the total amount of direct manufacturing costs incurred to support this level of production? If 13,000 units are produced, what are the total amount of indirect manufacturing costs incurred to support this level of production?
Variable manufacturing cost = $1.60= 13,000*1.60 =$20,800
Fixed Manufacturing overhead cost = $3.40 = 12,000*3.40 = $40,800
Total manufacturing overhead cost = $61,600
If 13,000 units are produced, What is this total amount expressed on a per unit basis? (Round your answer to 2 decimal places.)
Total manufacturing overhead cost = $61,600
Manufacturing overhead per unit = 61,600/13,000 = $4.74
5-What total incremental cost will Martinez incur if it increases production from 12,000 to 12,001 units? (Round your answer to 2 decimal places.)
Direct materials $ 5.40
Direct labor $ 2.90
Variable manufacturing overhead $ 1.60
= $9.90 incremental total manufacturing costs
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