Question
Sherri has developed a new popular bag for which she would like to hire workers to produce and spend some time promoting it. She
Sherri has developed a new popular bag for which she would like to hire workers to produce and spend some time promoting it. She will rent a garage for $300 per month for production purposes. Utilities will cost $90 per month. Sherri has already taken an industrial design course at the local college to help prepare. This course cost $450. Sherri will rent production equipment at a monthly cost of $1200. Sherri estimates the material cost per unit will be $4, and the labour cost will be $4 per unit. Sherri will need to quit her job, which pays $5000 per month. Advertising and promotion will cost $600 per month. Sherri anticipates producing 100 bags in the first month. Answer the following questions. NO COMMAS, NO S. 1. What is the total anticipated fixed cost S amount associated with production of the new product for the first month? 2. What is the total anticipated variable cost S amount associated with the production of the new product for the first month? 3. What is the total opportunity cost S amount associated with producing the new product? 4. What is the total sunk cost S amount associated with producing the new product? 5. Which cost S amount would NOT be considered a differential cost?
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