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erik [133]
3 years ago
11

PCB Corporation manufactures a single product. Monthly production costs incurred in the manufacturing process are shown below fo

r the production of 3,840 units. The utilities and maintenance costs are mixed costs. The fixed portions of these costs are $384 and $256, respectively.
Production in Units

3,840

Production Costs

Direct materials $9,600

Direct labor 19,200

Utilities 2,304

Property taxes 1,280

Indirect labor 5,760

Supervisory salaries 2,304

Maintenance 1,408

Depreciation 3,072

Calculate variable costs per unit, variable cost per unit for utilities and variable cost per unit for maintenance. Exclude mixed costs in the calculation for variable cost per unit. (Round answers to 2 decimal places e.g. 2.25.)
Variable cost per unit (Exclude variable cost for utilities and maintenance)
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Variable cost per unit for utilities
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Variable cost per unit for maintenance
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Calculate the expected costs when production is 6,400 units.
Cost to produce 6,400 units
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Business
1 answer:
Colt1911 [192]3 years ago
5 0

Answer:

Total Variable cost is $9 per unit

Varibale cost of Utilities is $0.5 per unit

Varibale cost of Maintainance $0.3 per unit

Explanation:

First calculate Fixed and Variable cost separately.

Fixed costs = Property taxes + Supervisory Salaries + Depreciation + Fixed utilities cost + Fixed Maintenance costs

Fixed Cost  = $1,280 + 2,304 + $3,072 + $384 + $256 = $7,296

Variable costs to produce 3,840 units = Direct materials + Direct labor + Indirect labor

Variable costs to produce 3,840 units = $9,600 + $19,200 + $5,760 = $34,560

Variable cost per unit = Total Variable cost / Number of units

Variable cost per unit = $34,560 / 3,840 = $9 per unit

Variable cost portion of mixed cost= Total cost – Fixed portion

Utilities

Variable cost  = $2,304 – $384 = $1,920

Variable cost per unit = $1,920 / 3,840 units = $0.5 per unit

Maintainance

Variable cost  = $1,408 – $256 = $1,152

Variable cost per unit = $1,152 / 3,840 units = $0.3 per unit

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