Requiremen 1. What is the total cost of producing 1,500 mailboxes? The total cos

Question

Requiremen 1. What is the total cost of producing 1,500 mailboxes? The total cost of producing 1,500 mailboxes is Requirement 2. If $21,645 of the total costs are fixed, what is the variable cost of producing each mailbox? The variable cost per unit is s Requirement 3. Write Express Mailbox's cost equation Requirement 4. If the plant manager uses the average cost per unit to predict total costs, what would the forecast be for 1,600 mailboxes? The total cost is Requirement 5. If the plant manager uses the cost equation to predict total costs, what would the forecast be for 1,600 mailboxes? The total cost is $

Explanation / Answer

Solution:

Part 6

Average cost per unit 25.43 Mailboxes produced 1,500 1 Total cost of producing 1,500 mailboxes - $ 25.43 * 1,500 mailboxes            38,145 2 Total cost of 1,500 mailboxes            38,145 Less: fixed cost 21,645 Variable cost of 1,500 mailboxes            16,500 Variable cost per unit - $ 16,500 /1,500 mailboxes                    11 3 Equation = $ 11*number of mailboxes + $ 21,645 4 Average Per unit cost 25.43 Mailboxes produced 1,600 Total cost of producing 1,500 mailboxes - $ 25.43 * 1,600 mailboxes            40,688 5 As per equation variable cost of 1,600 mailboxes - $ 11 * 1,600 17600 Add: fixed cost 21,645 Total cost 39,245

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