Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Ojo Outerwear Corporation can manufacture mountain climbing shoes for $ 4 5 . 1 7 per pair in variable raw material costs and $ 2

Ojo Outerwear Corporation can manufacture mountain climbing shoes for $45.17 per pair in variable raw material costs and $29.73 per pair in variable labor expense. The shoes sell for $210 per pair. Last year, production was 155,000 pairs. Fixed costs were $2.15 million.
a. What were total production costs? (Do not round intermediate calculations.)
b. What is the marginal cost per pair? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g.,32.16.)
c. What is the average cost per pair? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g.,32.16.)
d. If the company is considering a one-time order for an extra 5,000 pairs, what is the minimum acceptable total revenue from the order? (Do not round intermediate calculations.)
\table[[a. Total production cost,],[b. Marginal cost per pair,],[c. Average cost per pair,],[d. Minimum total revenue,]]
image text in transcribed

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

Students also viewed these Finance questions