Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

managerial accounting, please show all steps! total cost formula. Wolverine, Inc. manufactures ink that can only be detected by black light. The company incurs $65,000

managerial accounting, please show all steps! total cost formula.

image text in transcribed
Wolverine, Inc. manufactures ink that can only be detected by black light. The company incurs $65,000 in monthly depreciation costs on its manufacturing equipment as well as monthly advertising costs of $10,500 to place ads in newspapers and on the radio. Each container of ink requires materials and manufacturing overhead resources. On average the company uses 42,000 pounds of material to manufacture 80,000 containers of ink per month. Each pound of material costs $1.75. Direct labor costs on a per container basis are $1.50. The company incurs $23,000 in manufacturing overhead to produce 80,000 containers of ink per month. Required: a. Create the total cost formula (equation) for the monthly cost of the ink for Wolverine, Inc. based on the above information. b. If the company plans to manufacture 95,000 containers of ink next month, what is the expected fixed cost? c. What is the total variable cost at 95,000 units? d. What is the total cost at 95,000 units

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access with AI-Powered Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Fundamental Accounting Principles

Authors: John Wild, Ken Shaw, Barbara Chiappetta

22nd edition

9781259566905, 978-0-07-76328, 77862279, 1259566900, 0-07-763289-3, 978-0077862275

Students also viewed these Accounting questions