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Otsego Industries manufactured 300,000 units of product last year and identified the following costs associated with the manufacturing activity: ($000) Variable costs: Direct materials used
Otsego Industries manufactured 300,000 units of product last year and identified the following costs associated with the manufacturing activity: ($000) Variable costs: Direct materials used $ 6,120.0 Direct labor 4,060.0 Indirect materials and supplies 1,420.0 Power to run plant equipment 1,300.0 Fixed costs: Supervisory salaries $ 1,960.0 Plant utilities (other than for plant equipment) 1,621.7 Depreciation on plant and equipment 2,035.0 Property taxes on building 1,268.3 Required: Unit variable costs and total fixed costs are expected to remain unchanged in the following year. However, management expects a slowdown in sales, because of the economy in the following year. Calculate the unit cost and the total cost if 255,000 units are produced next ye
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