Question

Seymour Corporation manufactures batons. Seymour can manufacture 300,000 batons a year at a variable cost of $750,000 and a fixed cost of $450,000. Based on Seymour's predictions, 240,000 batons will be sold at the regular price of $5.00 each. In addition, a special order was placed for 60,000 batons to be sold at a 40 percent discount off the regular price. The unit relevant cost per unit for Seymour's decision is Select one: a. $3.00 b. $1.50 c. $2.50 d. $4.00

Answer 1

Answer:

c. $2.50

Explanation:

Calculation to determine The unit relevant cost per unit for Seymour's decision is

Unit relevant cost per unit=Variable cost/Number of banton units manufacture

Let plug in the formula

Unit relevant cost per unit=$750,000/350,000 units

Unit relevant cost per unit=$2.50

Therefore The unit relevant cost per unit for Seymour's decision is $2.50