Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Montero Industries' relevant range of activity is 3,000 units to 7,000 units. When it produces and sells 5,600 units, its average costs per unit are

Montero Industries' relevant range of activity is 3,000 units to 7,000 units. When it produces and sells 5,600 units, its average costs per unit are as follows:

image text in transcribed

Required:

a. For financial reporting purposes, what is the total amount of product costs incurred to make 5,600 units?

b. For financial reporting purposes, what is the total amount of period costs incurred to sell 5,600 units?

c. If 6,600 units are sold, what is the variable cost per unit sold?

d. If 6,600 units are sold, what is the total amount of variable costs related to the units sold?

e. If 6,600 units are produced, what is the average fixed manufacturing cost per unit produced?

f. If 6,600 units are produced, what is the total amount of fixed manufacturing cost incurred?

g. If 6,600 units are produced, what is the total amount of manufacturing overhead cost incurred? What is this total amount expressed on a per unit basis?

h. If the selling price is $23.00 per unit, what is the contribution margin per unit sold?

i. If 4,600 units are produced, what is the total amount of direct manufacturing cost incurred?

j. If 4,600 units are produced, what is the total amount of indirect manufacturing cost incurred?

k. What incremental manufacturing cost will the company incur if it increases production from 5,600 to 5,601 units?image text in transcribed

Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Fixed selling expense Fixed administrative expense Sales commissions Variable administrative expense Average Cost per Unit $ 5.50 $ 3.65 $ 1.80 $ 3.60 $ 0.80 $ 0.65 $ 0.55 $ 0.55 a. Total product cost b. Total period cost c. Variable cost per unit sold d. Total variable costs e. Average fixed manufacturing cost per unit produced f. Total fixed manufacturing overhead cost g. Total manufacturing overhead cost g. Manufacturing overhead per unit h. Contribution margin per unit i. Total direct manufacturing cost j. Total indirect manufacturing cost k. Incremental manufacturing cost

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored 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

Accounting Ethics A Practical Approach

Authors: Howard J Levine

1st Edition

0692112898, 9780692112892

More Books

Students also viewed these Accounting questions

Question

Did you cite the sources of the statistics?

Answered: 1 week ago