Question
have the following cost structures: $7,000 per engine, $11,000 per airframe, $4,800 for instrumentation and miscellaneous components. Certified mechanics cost $30 per hour, and it
have the following cost structures: $7,000 per engine, $11,000 per airframe, $4,800 for instrumentation and miscellaneous components. Certified mechanics cost $30 per hour, and it takes 40 hour to assemble a plane. Variable manufacturing overheads amounts to $400. Fixed manufacturing overhead is $10,000 per month. The company expects to build 48 planes per year. However, because of change in the factory floor layout, it produces 52 planes per year without increasing fixed manufacturing costs. The price of a plane is $39,000 each, and sales commissions are 5%. What is the companys variable cost per plane? How about full absorption cost?
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