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I am trying to figure out variable cost per jar, total variable cost at current production and number of jars of salsa. The wording on

I am trying to figure out variable cost per jar, total variable cost at current production and number of jars of salsa. The wording on the document is what is throwing me off.

Santiago's SalsaProduction Costs April 2020

Production - Jars of salsa25,000

Ingredient cost (variable)$20,000

Labor cost (variable)12,000

Rent (fixed)5,000

Depreciation (fixed)6,000

Other (fixed)1,000

Total$44,000

The company is currently producing and selling325,000jars of salsa annually. The salsa sellsfor$5.00each. The company is considering lowering the price to$4.60. Supposethe action will increase sales to375,000jars of salsa.

Variable costs per jar:

Ingredient cost

Labor cost

Total variable cost at current production$-

Number of jars of salsa

Variable cost per jar at current production$1.28

Incremental number of jars50,000

Incremental cost associated with price change$64,000

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