Erik is a sales representative for an established building materials manufacturer. Business is good, but he is concerned that th
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Answer:
The total monthly fixed manufacturing cost is $328,000.
Explanation:
For 4000 units, The direct materials cost is $99.2 per unit, the direct labor cost is $45.5 per unit, the manufacturing overhead cost is $94.
For 5000 units, The direct materials cost is $99.2 per unit, the direct labor cost is $45.5 per unit, the manufacturing overhead cost is $77.6.
Total manufacturing overhead for 4,000 units
=
= $376,000
Total manufacturing overhead for 5,000 units
=
= $388,000
The variable cost per unit
=
= $12 per unit
Fixed costs
= Total cost - Total variable costs
=
= $328,000