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il The company ZETOR Manufacturing currently produces 100 minitractors per month. The following per unit regular customers Unit costs (when we produce 100 units) Direct
il The company ZETOR Manufacturing currently produces 100 minitractors per month. The following per unit regular customers Unit costs (when we produce 100 units) Direct materials $400 Direct manufacturing labor 60 Variable manufacturing overhead 120 Fund manufacturing cueshead 200 Total manufacturing costs $780 1. The plant has a capacity for 500 minitractors and is considering expanding production to 400 minitractors per month. What is the total cost of producing 400 minitractors? 2. What is the most likely behavior of total manufacturing costs and unit manufacturing costs if the company would expand production to 500 minitractors to work at full capacity? (hint: write the cost function and estimate unit costs at full capacity)
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