Question

Fanning Corporation incurs the following annual fixed costs: Item Cost Depreciation $ 80,000 Officers’ salaries 190,000 Long-term lease 42,000 Property taxes 48,000 Required Determine the total fixed cost per unit of production, assuming that Fanning produces 4,000, 4,500, or 5,000 units.

Answer 1

Answer:

Instructions are listed below.

Explanation:

Giving the following information:

Item Cost Depreciation $ 80,000 Officers’ salaries 190,000 Long-term lease 42,000 Property taxes 48,000 Required Determine the total fixed cost per unit of production, assuming that Fanning produces 4,000, 4,500, or 5,000 units.

Total fixed costs= 80,000 + 190,000 + 48,000 + 190,000= 508,000

4,000 units= 127

4,500= 112.89

5,000= 101.6