Question

Fasheh Corporation's relevant range of activity is 7,000 units to 11,000 units. When it produces and sells 9,000 units, its average costs per unit are as follows: Average Cost per Unit Direct materials $ 5.50 Direct labor $ 3.90 Variable manufacturing overhead $ 1.30 Fixed manufacturing overhead $ 13.50 Fixed selling expense $ 2.25 Fixed administrative expense $ 1.80 Sales commissions $ 0.50 Variable administrative expense $ 0.45 If 10,000 units are produced, the total amount of manufacturing overhead cost is closest to:

Answer 1

Answer:

$134,500

Explanation:

Total manufacturing overhead = Variable overhead + Fixed overhead

Variable overhead= $1.3 * 10,000 units= $13000  

Fixed overhead = $13.50 * 9000 units = $121,500

Total manufacturing overhead= $13,000+$121,500

= $134,500