Question

The following variable production costs apply to goods made by O'Brien Manufacturing Corporation: Item Cost per Unit Materials $ 6.00 Labor 3.00 Variable overhead 3.50 Total $ 12.50 Required Determine the total variable production cost, assuming that O'Brien makes 4,000, 8,000, or 12,000 units.

Answer 1

Answer:

$50,000 ; $100,000 ; $150,000

Explanation:

The computation of the total variable production cost is shown below:

For 4,000 units, it would be

= 4,000 units × $12.50

= $50,000

For 8,000 units, it would be

= 8,000 units × $12.50

= $100,000

For 12,000 units, it would be

= 12,000 units × $12.50

= $150,000

Simply we multiplied the total variable cost per unit with the respective units