The Lallone Company manufactures fine jewelry that it sells to department stores throughout the United States. Lallone is trying to decide which of the two bracelets to make. The cost data for the two options are shown below.

	bracelet A			B bracelet
Material cost per unit	ps	sixteen		ps	30
Cost of labor per unit		32			32
Advertising cost per year		7,500			5,000
Annual depreciation of existing equipment.		5,000			4,000
Required

a.

Identify the fixed costs and determine the amount of fixed cost for each product.

Fixed costs	bracelet A	B bracelet
Total fixed costs

b.	Identify the variable costs and determine the amount of variable cost per unit for each product.

Variable costs	bracelet A	B bracelet
Total Variable Costs

C.	Identify avoidable costs and determine the amount of avoidable cost for each product.

avoidable costs	bracelet A	B bracelet