Anticipated Costs: Rent. $25.00 a square foot (including square footage and common costs) for 2000 sqft of space. Calculate for the year.

Yearly Depreciation $8,000.00

Management Salaries (for yourself and Connor) $40,000 each per year

Hourly manufacturing and assembly labour. This is estimated at 4 hours @ $20.00/hr for each unit.

Yearly Insurance $5000.00

Monthly external quality control and third-party audit $300.00

General administrative expense including bookkeeping services. This is paid monthly at a flat rate of $350.00

Engines for the Sand Blower machines purchased from Honda Canada $575 for each unit

Other components such as plastics, metal, bolts, and additional materials to assemble each unit $225.00

Yearly building maintenance $4000.00

Monthly website development and maintenance fee $250.00

Manufacturing equipment (buying and setting up the die-cut equipment and tools to assemble the Sand Blower units $14,500.00

Freight to ship the finished product to the end-user (after purchase) for each unit $110.00

Here are your tasks: Classify each cost as fixed or variable.

When tabulated:

Calculate the yearly total fixed cost.

Enter your answer for the FIXED COST HERE: $Answer 151200

Calculate the variable costs for each unit

Enter your answer for the VARIABLE COST for each unit HERE: $Answer 19340