Andretti Company has a single product called a Dak. The company normally produces and sells 82,000 Daks
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Andretti Company has a single product called a Dak. The company normally produces and sells 82,000 Daks each year at a selling price of $60 per unit. The company's unit costs at this level of activity are given below:
Direct materials $ 9.50
Direct labor 11.00
Variable manufacturing overhead 2.50
Fixed manufacturing overhead 9.00 ($738,000 total)
Variable selling expenses 3.70
Fixed selling expenses 3.00 ($246,000 total)
Total cost per unit $ 38.70
A number of questions relating to the production and sale of Daks follow. Each question is independent:
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