Question
Eagle Company has built a new model jet aircraft, which it intends to sell to high net worth clients. This aircraft required 20,000 hours to
Eagle Company has built a new model jet aircraft, which it intends to sell to high net worth clients. This aircraft required 20,000 hours to complete. Eagle believes a cumulative average learning model best reflects the company's production efficiency.
Eagle's manufacturing costs for the second aircraft are presented below.
|
| ||
Direct labor | $ | 140 | per direct labor hour |
Variable overhead |
| 120 | per direct labor hour |
Fixed overhead |
| 200000 | per unit |
Materials |
| 90000 | per unit |
Eagle just received a contract to make three more identical aircraft (a total of four were made). The total labor cost for the second unit was $2,240,000.
What will be the total expected unit cost for four aircrafts? (Please round to the closest number)
$4,502,000 | ||
$3,328,000 | ||
$4,212,000 | ||
$3,618,000
|
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started