3.		If 8,000 units are sold, what is the variable cost per unit sold? $12.50
			Direct materials.....................................................................
			Direct labor............................................................................
			Variable manufacturing overhead.........................................
			Sales commissions.................................................................
			Variable administrative expense...........................................
			Variable cost per unit sold.....................................................	$12.50
	4.		If 12,500 units are sold, what is the variable cost per unit sold? Same as # 3; $12.50. Per unit does not changes. Why does the per unit variable will be not change?
	5.		If 8,000 units are sold, what is the total amount of variable costs related to the units sold? $100,000
			Variable cost per unit sold (a)...............................................	$12.50
			Number of units sold (b).......................................................	8,000
			Total variable costs (a) (b)..................................................	$100,000
	6.		If 12,500 units are sold, what is the total amount of variable costs related to the units sold? $156,250 See computation below
			Variable cost per unit sold (a)...............................................	$12.50
			Number of units sold (b).......................................................	12,500
			Total variable costs (a) (b)..................................................	$156,250
	7.		For #7 & 8, please find average cost per unit. In # 7 the units produced are 8,000 while in #8 they are 12,500. Total fixed manufacturing cost (see requirement 1) (a)......................................................	$40,000
			Number of units produced (b)..............................................	8,000
			Average fixed manufacturing cost per unit produced (a) (b).......................................................................................	?

C: Users\murtuzat\Dropbox 0_consolidated teaching1001_teaching_2017100_fALL 2017\f17_pre quiz & ICWA0_inclass exercises_17 ch 2\f 17_ch2_foundational_091217_p.docx Foundational Problem, Page 49, Chapter 2 (covers LEARNING OBJECTIVEs 2-1, 2-2, 2-3, 2-4, 2-6, 2-7] This is a reproduction of the foundational problem. Martinez Company's relevant range of production is 7,500 units to 12,500 units. When it produces and sells 10,000 units, its unit costs are as follows: Amount Per Unit $6.00 $3.50 $1.50 $4.00 $3.00 $2.00 $1.00 $0.50 Fixed manufacturing overhead . . . This exercise has 2 parts: Part 1 is WARM UP for Part 2, which requires you to answer questions asked. Warm-UP: To help you with the Warm up portion of the exercise, I am using 2 tables which rearranges the information the exercise provides in a slightly different form. Please study it! Table 1 classifies various items from the data given; the first column (A) gives item number; the last column (G) on right gives the total costs for 10,000 units. The 2nd column (B) shows if the item is direct or indirect; 3rd column shows variable or fixed; 4th (D) says whether it is product (pr) or (pe)or period cost. It then adds the numerical values of those items