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Required information Cost Classifications (Algo) [The following information applies to the questions displayed below.] Kubin Company's relevant range of production is 29,000 to 33,000 units.
Required information Cost Classifications (Algo) [The following information applies to the questions displayed below.] Kubin Company's relevant range of production is 29,000 to 33,000 units. When it produces and sells 31,000 units, its average costs per unit are as follows: Average Cost per Unit Direct materials Direct labor Variable manufacturing overhead $ 8.90 $ 5.90 $ 3.40 Fixed manufacturing overhead $ 6.90 Fixed selling expense $ 5.40 Fixed administrative expense $ 4.40 Sales commissions $ 2.90 Variable administrative expense $ 2.40 Exercise 1-10 (Algo) Differential Costs and Sunk Costs [LO1-5] Required: 1. What is the incremental manufacturing cost incurred if the company increases production from 31,000 to 31,001 units? 2. What is the incremental cost incurred if the company increases production and sales from 31,000 to 31,001 units? 3. Assume that Kubin Company produced 31,000 units and expects to sell 30,610 of them. If a new customer unexpectedly emerges and expresses interest in buying the 390 extra units that have been produced by the company and that would otherwise remain unsold, what is the incremental manufacturing cost per unit incurred to sell these units to the customer? 4. Assume that Kubin Company produced 31,000 units and expects to sell 30,610 of them. If a new customer unexpectedly emerges and expresses interest in buying the 390 extra units that have been produced by the company and that would otherwise remain unsold, what incremental selling and administrative cost per unit is incurred to sell these units to the customer
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