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Fresh as a Daisy, Inc, manufactures flower pots. It can produce and sell plain, unpainted pats for $12 each and the manufacturing costs incurred for
Fresh as a Daisy, Inc, manufactures flower pots. It can produce and sell plain, unpainted pats for $12 each and the manufacturing costs incurred for the plain, unpainted pots are as follows: Variable manufacturing costs per pot: $4.50 Fixed manufacturing cost per pot: $1.50 Variable Selling and admin costs per pot $0.25 Fixed Selling and admin costs per pot: $0.75 Fresh as a Daisy can also process these pots further by painting them with special desiens for customers. It could sell these painted pots for $18 each. The additional variable manufacturing costs of painting and finishing the pots would be $3 per pot, and there would be no additional fixed manufacturing costs nor any additional selling and administrative costs. What is the financial advantage (disadvantage) per unit for the company if it processes the flower pots further by painting them? OOOOO Falling Dawn Co.'s relevant range of activity is 55,000 units to 65,000 units. When it produces and sells 60,000 units, its costs per unit are as follows: Per unit cost: $1.80 $5.90 Direct materials Direct labor Variable manufacturing overhead Foxed manufacturing overhead Variable selling and administrative costs $1.20 $1.70 $0.90 Foed selling and administrative costs $1.30 If 62,000 units are produced, the total manufacturing cost is closest to: $551,800 . 5653,800 $67,200 d. $787,600 8. $793,600
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