1. DEF Company's average cost per unit is $1.425 at the 16,000 unit level of activity and $1.38 at the 20,000 unit level of activity. Assume that all of the activity levels mentioned in this problem are within the relevant range.

Required:

Predict the following items for DEF Company:

a. Variable cost per unit.

b. Total fixed cost per period.

c. Total expected costs at the 18,000 unit level of activity.

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2. TUV Inc., a manufacturing company, has provided the following financial data for September:

Sales $590,000

Variable production expense $106,000

Variable selling expense $18,000

Variable administrative expense $78,000

Fixed production expense $145,000

Fixed selling expense $72,000

Fixed administrative expense $132,000

The company had no beginning or ending inventory.

Required:

a. Income statement in good form for September using the traditional approach.

b.Income statement in good form for September using the contribution approach.

c. For managerial accounting perspective, what approach is more useful and why?