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Gertrude's Glassworks makes glass flanges for scientific use. Materials cost $1 per flange, and the glass blowers are paid a wage rate of $28 per
Gertrude's Glassworks makes glass flanges for scientific use. Materials cost $1 per flange, and the glass blowers are paid a wage rate of $28 per hour. A glass blower blows 10 flanges per hour. Fixed manufacturing costs for flanges are $28,000 per period. Period (nonmanufacturing) costs associated with flanges are $18,000 per period and are fixed. Read the requirements. Requirement 2. Assume Gertrude's Glassworks manufactures and sells 4,000 flanges this period. Their competitor, Finn's Flasks, sells flanges for $10.00 each. Can Gertrude sell below Finn'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 Materials cost per unit + Total cost per unit they sll below The total cost per unit when manufacturing 4,000 flanges is therefore, t Finn's price and still make a profit Requirement 3. How would your answer to requirement 2 differ if Gertrude's Glassworks made and sold 10,000 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 10,000 flanges would be $ With production and sales at this level, the company make a profit if the selling price is below S 10.00 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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