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You are given the following information regarding Prime Manufacturing Company: Months Production Direct materials Factory workers (wages) Factory supervisors (salary) Premises Rental Maintenance costs *
You are given the following information regarding Prime Manufacturing Company: Months Production Direct materials Factory workers (wages) Factory supervisors (salary) Premises Rental Maintenance costs * April 5 800 units R1 336 030 R1 566 000 R222 600 R820 000 R534 240 May 7 400 units R1 704 590 R1 998 000 R222 600 R820 000 R551 520 June 8 600 units R1 981 010 R2 322 000 R222 600 R820 000 R564 480 *The maintenance relates to plant and machinery, and it is charged at a flat rate per month plus an additional cost based on the number of units produced. The entity sells its products at R950 per unit. a) Calculate the total variable cost per unit in the month of June. (6) b) What is the fixed cost for the month of June? (4) c) Calculate contribution per unit. (2) d) What will the total cost be for the month of July, if production is 12 000 units? (3)
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