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Saved 3 The Mahela Company specializes in producing sets of wooden patio furniture consisting of a table and four chairs. The company is Currently operating at 80% of its full capacity of 3,600 sets per quarter Quarterly cost data at this level of operations follow: 5 001152 Factory labour, direct Advertising Factory supervision Property taxes, factory building Sales comissions Insurance, factory Depreciation, office equipment Lease cost, factory equipment Indirect saterials, factory Depreciation factory building General office supplies (billing) General office salaries Direct materials used (wood, bolts, etc.) utilities, factory $125,000 51,600 41,609 5,100 88,000 4,100 5,600 13,600 7,600 11,600 4,600 68,000 102,000 21,600 Required: 1. Enter the dollar amount of each cost item under the appropriate headings. As examples, this has been done already for the first two items in the preceding list. Note that each cost item is classified in two ways: first, as variable or fixed, with respect to the number of units produced and sold, and second, as a selling and administrative cost or a product cost (if the item is a product cost, it should also be classified as either direct or indirect as shown) Cost Product Cost Direct Indirect 126 000 $ $ 41.600 5,100 Cost Behaviour Selling and Variable Administrative Fixed 126 000 51.600 51 600 41.600 5.100 18 000 88 000 4.100 5.600 5600 13.600 7.500 11,600 4600 4.600 58.000 Cost Item Factory labour direct Advertising Factory supervision Property taxes, factory building Sales commissions Insurance factory Depreciation office equipment Lease cost factory equipment Indirect materials, factory Depreciation factory building General office supplies (billing) General office salaries Direct materials used (wood, balts, etc) Utilities factory Total costs "To units of product 4 100 13 600 7 600 11 600 6.800 102.000 102,000 21 600 349 8005 5 201 2005 156 6005 220 000 $ 21 600 105 200 2. Based on the answers obtained in Requirement (1). compute the average product cost per patio set. (Round your answer to 2 decimal places Average product cost per patio set 3. Assume that production increases to only 3.240 sets quarterly. Would you expect the average product cost per patio set to increase, decrease, or remain unchanged? Increase O Decrease Remain unchanged 4. Refer to the original data The president's brother-in-law has considered making a patio set and has priced the necessary materials at a building supply store. He has asked the president if he could purchase a patio set from the Mahela Company at cost," and the president has agreed to let him do so a. Would you expect any disagreement over the price the brother-in-law should pay? What price does the president probably have in mind? (Round your answer to 2 decimal places.) the president may expect a minimum price of