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Camden Tools produces and sells Charleys, a unique, multi-purpose tool. Charleys are sold across the US in a variety of retail stores at a
Camden Tools produces and sells "Charleys", a unique, multi-purpose tool. "Charleys" are sold across the US in a variety of retail stores at a price of $100 per unit. The 2021 actual average cost per unit, based on the actual 2021 production and sales volume of 75,000 "Charleys", is provided below: Manufacturing costs per unit: Direct Materials Direct Labor Variable manufacturing overhead $ 25.00 10.00 7.00 Fixed manufacturing overhead 20.00 Total manufacturing costs per unit $62.00 Nonmanufacturing costs per unit: Variable shipping costs Variable selling commissions and marketing costs Fixed marketing & administrative costs Total nonmanufacturing costs per unit Total cost per unit $ 10.00 5.00 13.00 $28.00 $90.00 Each situation described in each question below is independent of the others. Unless stated otherwise, assume that the cost behavior patterns, selling price, and production and sales volume will continue into the future. Assume decision makers are rational profit maximizers.
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