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Required information Skip to question [ The following information applies to the questions displayed below .] Morning Dove Company manufactures one model of birdbath, which
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[The following information applies to the questions displayed below.]
Morning Dove Company manufactures one model of birdbath, which is very popular. Morning Dove sells all units it produces each month. The relevant range is 0 to 1,500 units, and monthly production costs for the production of 1,100 units follow. Morning Doves utilities and maintenance costs are mixed with the fixed components shown in parentheses.
Production Costs | Total Cost |
---|---|
Direct materials | $ 1,900 |
Direct labor | 7,900 |
Utilities ($120 fixed) | 620 |
Supervisors salary | 3,200 |
Maintenance ($350 fixed) | 470 |
Depreciation | 800 |
Required:
- Identify each cost as variable, fixed, or mixed, and express each cost as a rate per month or per unit (or combination thereof).
- Determine the total fixed cost per month and the variable cost per unit for Morning Dove.
- State Morning Doves linear cost equation for a production level of 0 to1,500 units. Enter answer as an equation in the form of y = a + bx.
- Calculate Morning Doves expected total cost if production increased to 1,300 units per month. Enter answer as an equation in the form of y = a + bx.
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