Fixed versus variable cost behavior. Wray chairs corporation produces ergonomically designed chairs favored by architects. The company normally produces and sells for 4.000 to 10,000chairs per year. the following cost data apply to various activity levels.

number of chairs 2000 3000 4000 5000

Total costs incurred

fixed $60000

variable $20000

Total cost $80000

Per unit chair cost

fixed $ 30.00

Variable 10

Total cost per chair $40

A. Complete the preceding table by filling in the missing amounts for the levels of activity shown in the first row of the table

B. Explain why the total cost per chair decreases as the number of chairs increases.