PQR Manufacturing produces consumer electronics. Calculate the direct costs, fixed costs, variable costs, and total operating costs for a production run of 1,000 units based on the following information:

• Direct materials (direct): $20,000
• Direct labor (direct): $15,000
• Factory rent (fixed): $15,000 per month
• Utilities (variable): $1,000 per month plus $2 per unit
• Maintenance costs (fixed): $10,000 annually
• Packaging costs (variable): $500 plus $1 per unit

Requirements:

• Present the breakdown of direct, fixed, and variable costs for producing 1,000 units in a tabular format.
• Calculate the total operating costs for the production run.
• Discuss the relationship between fixed costs and production volume.
• Analyze the impact of increasing production to 2,000 units on total variable costs.
• Recommend efficiency improvements to reduce overall production costs.