Question
Calico Joe Fabrics sells a single product. The company estimates total fixed costs at $360,000 with demand and unit variable costs at various activity levels
Calico Joe Fabrics sells a single product. The company estimates total fixed costs at $360,000 with demand and unit variable costs at various activity levels as follows: Units Demanded Unit Price Total Variable Costs
73,000 $31 $1,606,000 83,000 30 1,826,000 93,000 29 2,046,000 103,000 28 2,266,000 113,000 27 2,486,000 How would you best describe Calico's variable cost per unit over the range shown? A. There is not enough information provided to determine the answer. B. It is constant. C. It is decreasing as volume increases. D. It is increasing as volume increases.
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