Answer:
The total variable cost will be $ 16 * 3620= $ 57920
Explanation:
CC
Analyzing Proposed Project
<u> Given 1 2 3</u>
Variable Increase ---- 10% 9.125% 9.125%
<u>Fixed Decreased 6.97% </u>
Sales price per unit $24 $24 $24 $24
Variable price per unit $ 14.6 $16.06 $ 16 $ 16
Fixed Costs $ 12900 12900 $ 12900 $ 12000
Sales Volume 3620 3620 3620 3620
We have taken the sale prices constant and changed the variable costs and fixed costs.
CC
Sensitivity Analysis Report
Given 1 2 3
Sales 86880 86880 86880 86880
Variable Costs 52852 58137.2 57920 57920
Contribution Margin 34028 28742.8 28960 28960
<u>Fixed Costs 12900 12900 12900 12000 </u>
<u>Operating Profit 21128 15482.8 16060 16960</u>
Dollar Change in
<u>Variable Expenses 5645.2 5068 5068 </u>
<u />
<u>The total variable cost will be $ 16 * 3620= $ 57920</u>
