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Tire and Spoke Manufacturing currently produces 1,000 bicycles per month. The following per unit data apply for sales to regular customers: Direct materials 50 Direct
Tire and Spoke Manufacturing currently produces 1,000 bicycles per month. The following per unit data apply for sales to regular customers:
Direct materials 50
Direct manufacturing labour 5
Variable manufacturing overhead 14
Fixed manufacturing overhead 10
Total manufacturing costs 79
The plant has a capacity for 3,000 bicycles and is considering expanding production to 2,000 bicycles. What is the per-unit cost of producing 2,000 bicycles?
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