Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Kubin Company's relevant range of production is 24,000 to 31,000 units. When it produces and sells 27,500 units, its average costs per unit are
Kubin Company's relevant range of production is 24,000 to 31,000 units. When it produces and sells 27,500 units, its average costs per unit are as follows: Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Fixed selling expense Fixed administrative expense Average Cost per Unit $ 8.40 $ 5.40 $ 2.90 $ 6.40 $ 4.90 $ 3.90 $ 2.40 $ 1.90 Sales commissions Variable administrative expense Required: 1. What is the incremental manufacturing cost incurred if the company increases production from 27,500 to 27,501 units? 2. What is the incremental cost incurred if the company increases production and sales from 27,500 to 27,501 units? 3. Assume that Kubin Company produced 27,500 units and expects to sell 27,160 of them. If a new customer unexpectedly emerges and expresses interest in buying the 340 extra units that have been produced by the company and that would otherwise remain unsold, what is the incremental manufacturing cost per unit incurred to sell these units to the customer? 4. Assume that Kubin Company produced 27,500 units and expects to sell 27,160 of them. If a new customer unexpectedly emerges and expresses interest in buying the 340 extra units that have been produced by the company and that would otherwise remain unsold, what incremental selling and administrative cost per unit is incurred to sell these units to the customer? What is the incremental manufacturing cost incurred if the company increases production from 27,500 to 27,501 units? (Round your answers to 2 decimal places.) Direct materials Direct labor Variable manufacturing overhead Total incremental cost $ 0.00 What is the incremental cost incurred if the company increases production and sales from 27,500 to 27,501 units? (Round your answers to 2 decimal places.) Direct materials Direct labor Variable manufacturing overhead Sales commissions Variable administrative expense Assume that Kubin Company produced 27,500 units and expects to sell 27,160 of them. If a new customer unexpectedly emerges and expresses interest in buying the 340 extra units that have been produced by the company and that would otherwise remain unsold, what is the incremental manufacturing cost per unit incurred to sell these units to the customer? Incremental manufacturing cost Assume that Kubin Company produced 27,500 units and expects to sell 27,160 of them. If a new customer unexpectedly emerges and expresses interest in buying the 340 extra units that have been produced by the company and that would otherwise remain unsold, what incremental selling and administrative cost per unit is incurred to sell these units to the customer? (Round your answers to 2 decimal places.) Sales commission Variable administrative expense Variable cost per unit sold Show less
Step by Step Solution
There are 3 Steps involved in it
Step: 1
The image contains a scenario involving Kubin Companys costs associated with producing and selling u...Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started