Gayle's Glassworks makes glass flanges for scientific use. Materials cost $$3$ per flange, and the glass blowers are paid a wage rate of $$22$ per hour. A glass blower blows $10$ flanges per hour. Fixed manufacturing costs for flanges are $$22,000$ per period. Period $($nonmanufacturing$)$ costs associated with flanges are $$12,000$ per period and are fixed.

Read the requirements.

kequirement $1.$ Select the grapn that snows tixea, variadie, and total manuracturing cost tor tianges, using units $($number or nanges$)$ on the $x-$axis. $($tniarge eacn grapn derore seiecing your answer.$)$

A $$

r

D$.$

$8^{}$

$8^{}$

$8^{}$

Requirement $2.$ Assume Gayle's Glassworks manufactures and sells $4,000$ flanges this period. Its competitor, Faris's Flasks, sells flanges for $$9\mathrm{.}80$ each. Can Gayle sell below Faris's price and still make a profit on the flanges? $($Round the total cost per unit to two decimal places.$)$

Begin by determining the formula used to calculate the total cost per unit.

$()$ Total cost per unit

The total cost per unit when manufacturing $4,000$ flanges is $]$; therefore, they $$ sell below Faris's price and still make a profit.

Requirement $3.$ How would your answer to requirement $2$ differ if Gayle's Glassworks made and sold $8,000$ flanges this period? Why? What does this indicate about the use of unit cost in decision making? $($Round the total cost per unit to two decimal places.$)$

The total cost per unit when manufacturing $8,000$ flanges would be $$

With production and sales at this level, the company $$ make a profit if the selling price is below $$9\mathrm{.}80$ each. Managers must be cautious using unit costs for decision making because $$ remain the same regardless of the number of units produced.

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