Grahams 's Glassworks makes glass flanges for scientific use. Materials cost $ 1 per flange, and the glass blowers are paid a wage rate of $ $29 per hour. A glass blower blows 10 flanges per hour. Fixed manufacturing costs for flanges are $22,000 per period. Period (nonmanufacturing) costs of flanges are $16,000 per period, and are fixed. Requirements 1. Graph the fixed, variable, and total manufacturing cost for flanges, using units (number of flanges) on the x-axis (the horizontal axis). 2. Assume GrahamGraham's Glassworks manufactures and sells 7,000 flanges this period. Its competitor, Flora's Flasks, sells flanges for $9.00 each. Can GrahamGraham sell below Flora's price and still make a profit on the flanges? 3. How would your answer to requirement 2 differ if GrahamGraham's Glassworks made and sold 9,000 flanges this period? Why? What does this indicate about the use of unit cost in decision making?

Assume

Assume

Glassworks manufactures and sells

7,000

flanges this period. Its competitor, Flora's Flasks, sells flanges for

$9.00 each. Can Graham sell below Flora's price and still make a profit on the flanges?

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

(

Total fixed costs

+

Total variable costs

) /

Units produced and sold

=

Total cost per unit

The total cost per unit when manufacturing

7,000

flanges is ---------

therefore, they

-----------make a profit, when compared to Flora's Flasks selling price of $9.00 each. (Round the total cost per unit to two decimal places.)

Requirement 3. How would your answer to requirement 2 differ if Graham Glassworks made and sold 9,000

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 decimalplaces.)

The total cost per unit when manufacturing

9 comma 0009,000

flanges would be

-------------