Cost Behavior Smoke City, Inc., manufactures barbeque smokers. Based on past experience, SmokeCity has found that its total annual overhead costs can be represented by the following formula: Overhead cost = $542,010 + $1.30x, where X equals number of smokers. Last year, Smoke City produced 20,300 smokers. Actual overhead costs for the year were as expected. Required: 1. What is the driver for the overhead activity? Number of hours ter the final answers rounded to the nearest dollar. Number of orders Verhead cost incurred by Smoke City last year? Number of smokers Units sold ked overhead cost incurred by Smoke City last year? 4. What is the total variable overhead cost incurred by Smoke City last year? For questions 5-7, round your answers to the nearest cent. Use those rounded figures in subsequent computations, if necessary. 5. What is the overhead cost per unit produced? $ per unit 6. What is the fixed overhead cost ner unit? For questions 2-4, Enter the final answers rounded to the nearest dollar. 2. What is the total overhead cost incurred by Smoke City last year? $ 3. What is the total fixed overhead cost incurred by Smoke City last year? 4. What is the total variable overhead cost incurred by Smoke City last year? For questions 5-7, round your answers to the nearest cent. Use those rounded figures in subsequent computations, if necessary. 5. What is the overhead cost per unit produced? per unit 6. What is the fixed overhead cost per unit? per unit 7. What is the variable overhead cost per unit? per unit 8. Recalculate Requirements 5, 6, and 7 for the following levels of production: (a) 19,600 units and (b) 22,100 units. Round your answers to the nearest cent. 19,600 Units 22,100 Units 4. What is the total variable overhead cost incurred by Smoke City last year? $ For questions 5-7, round your answers to the nearest cent. Use those rounded figures in subsequent computations, if necessary. 5. What is the overhead cost per unit produced? $ per unit 6. What is the fixed overhead cost per unit? $ per unit 7. What is the variable overhead cost per unit? per unit 8. Recalculate Requirements 5, 6, and 7 for the following levels of production: (a) 19,600 units and (b) 22,100 units. Round your answers to the nearest cent. 19,600 Units 22,100 Units Unit cost Unit fixed cost Unit variable cost The reason the unit costs changed in the way they did is because: 4. What is the total variable overhead cost incurred by Smoke City last year? For questions 5-7, round your answers to the nearest cent. Use those rounded figures in subsequent computations, if necessary. 5. What is the overhead cost per unit produced? per unit 6. What is the fixed overhead cost per unit? per unit 7. What is the variable overhead cost per unit? per unit 8. Recalculate Requirements 5, 6, and 7 for the following levels of production: (a) 19,600 units and (b) 22,100 units. Round your answers to the nearest cent. the relevant range has increased the total fixed costs are increasing the fixed costs are being spread over the different levels of production. the unit variable cost is dropping as production rises dropdown
