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[The following information applies to the questions displayed below.] Martinez Companys relevant range of production is 7,500 units to 12,500 units. When it produces and
[The following information applies to the questions displayed below.]
Martinez Companys relevant range of production is 7,500 units to 12,500 units. When it produces and sells 10,000 units, its average costs per unit are as follows:
Average Cost per Unit | |||
Direct materials | $ | 6.10 | |
Direct labor | $ | 3.60 | |
Variable manufacturing overhead | $ | 1.40 | |
Fixed manufacturing overhead | $ | 4.00 | |
Fixed selling expense | $ | 3.10 | |
Fixed administrative expense | $ | 2.10 | |
Sales commissions | $ | 1.10 | |
Variable administrative expense | $ | 0.55 | |
15. What incremental manufacturing cost will Martinez incur if it increases production from 10,000 to 10,001 units?
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