You are considering purchasing a facility that produces high-quality ice cream from a company that has filed for bankruptcy. The facility will cost you $650,000, performing neglected maintenance will cost you $80,000, monthly inspections cost $1,000 each, milk costs $2.50/gallon (it takes 0.5 gallons to make 1 unit of ice cream), other ingredients costs $0.45 per unit of ice cream and employees earn $20.00/hr (it takes 3 minutes of work for 1 unit of ice cream).Assume that the questions that follow are based on production for one year.

#1) What are your fixed costs if you produce 100,000 units of ice cream?

#2) What are your variable costs if you produce 100,000 units of ice cream?

#3) What are your total costs if you produce 100,000 units of ice cream?