The salespeople at Culver, a notebook manufacturer, commonly pressured operations managers to keep costs down so the company could give bigger discounts to large customers. Charles, the operations supervisor, leaked the $1.25 total unit cost to salespeople, who were thrilled, since that was slightly lower than the previous year's unit cost. Budgets were not yet finalized for the upcoming year, so it was unclear what the target unit cost would be. Charles knew the current year's operating capacity was two million notebooks, and Culver produced and sold just that many. The detailed breakdown of the $1.25 total unit cost is as follows. (a) Your answer is correct. What were Culver's total fixed costs? If the average selling price was $1.95, how much gross margin did the company generate? Total fixed costs $ Gross margin $ Your answer is correct. If Culver incurs exactly the same total fixed costs but produces and sells only 1,600,000 notebooks this coming year, what happens to the fixed cost per unit? In turn, what would the total cost per unit be? If the average selling price stays at $1.95, how much gross margin would be earned? (Round per unit answers to 2 decimal places, e.g. 15.25.) Fixed costs by $ per unit Total cost per unit $ per unit Gross margin $ eTextbook and Media Attempts: 2 of 3 used (C) Your answer is correct. If Culver reworks its equipment layout and processes to increase the top end of its relevant range of activity to 2,500,000 notebooks without incurring more fixed costs, what happens to the fixed cost per unit if it is able to make and sell that larger quantity of units? (Round per unit answers to 2 decimal places, e.g. 15.25.) Fixed costs by $ per unit Total cost per unit $ per unit Gross margin $ How deep a discount could salespeople give customers under scenario (c) and still generate the same total gross margin as last year? (Round answer to 1 decimal place, e.g. 15.2\%.) Discount %