Daisy Drink Company has the following budget at 500,000 cases of cola:

Direct materials..............................$180,000

Direct labor.....................................$160,000

Variable Factory overhead.............$150,000

Fixed factory overhead..................$130,000

$620,000

(1) Compute the cost per case of cola at 500,000 cases.

(2) Develop the budget for 550,000 cases.

(3) Compute the cost per case at 550,000 dozen.

(4) Explain why the difference in the cost per dozen occurs at the different levels of

volume.