Data Table Combined Motors specializes in producing one specialty vehicle. It is called Surfer and is styled to easily fit multiple surfboards in its back area and top-mounted storage racks. Combined has the following manufacturing costs: Req 1.W 2.Pl F(Click the icon t view the manufacturing costs.) Plant management costs, $1,332,000 per year 3.W Combined currently produces 21 vehicles per month. H Workers' wages. S500 per Surfer vehicle produced Direct materials costs: Steel, $1,600 per Surfer, Tires, $150 per tire, each Surfer takes 5 tires (one spare) City license, which is charged monthly based on the number of tires used in production: Requirement 1. What is the variable manufacturing cost per vehicle? What is the fixed manufacturing cost per month? The variable cost per vehicle is S $60,000 0-500 tires 501-1,000 tires $75,000 Determine the fixed manufacturing cost per month at each of the following capacity levels. $240,000 more than 1.000 tires 0-500 tires per month 501-1,000 tires per month more than 1,000 tires per month Print Done (After you hit continue, the screen may take you below the beginning of the next step. If so, scroll back up to the top of the Requirement 2. Plot a graph r the variable manufacturing costs and a second for the fixed manufacturing costs per month. How does the concept of relevant range relate your graphs? Explain. Begin by plotting the variable manufacturing cost. Plot your graph using the followin number of vehicles: 0 and 240 vehicles. (Enlarge the line button displayed below to draw the graph.) an Select the graph that shows the fixed manufacturing costs. (Enlarge each graph before selecting your answer.) O C. O D. O A $500,000 $400.000- $500,000 S400 000: S500,0001 $400,000 s500.000- S400 0002 $100,000 S100,000 $100,0005 $100,000 Si 500 1.000.500 500 1.000,S00 500 1.00g.s00 500 1.000.500 Tires Used in Production Tires Used in Production Tires Used in Production Tires Used in Production How does the concept of relevant range relate to your graphs? Explain. place restrictions on the unit variable costs. The relevant range for the total fixed costs is from 0 to 500 tires; 501 relevant for both graphs. The question The concept of relevant range 1000 tires: more than 1000 tires, and so on. Requirement 3. What is the total manufacturing cost of each vehicle if 100 vehicles are produced each month? 225 vehicles? How do you explain the difference in the manufacturing cost per unit? Calculate the manufacturing cost of each vehicle (a) if 100 vehicles are produced each month and (b) if 225 vehicles are produced each month. (Round your answers to the nearest cent.) Vehicles Fixed unit Variable unit Total unit cost per vehicle per month cost per vehicle cost per vehicle (a) 100 225 (b) Explain the difference in the unit-cost figures. vehicles and the per unit is The difference is caused increment of $180,000 being spread over an increment of the
