l s relevant range of activity is 2,000 units to 6,000 units. When it produces a

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l

s relevant range of activity is 2,000 units to 6,000 units. When it produces and sells 4,000 unts, its average costs per unit are as follows of 3 Average Cost per Unit Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Fixed selling expense Fixed administrative expense Sales commissions Variable administrative expense s 5.95 $ 3.30 $ 1.60 $ 3.00 $0.50 $ 0.40 $ 1.50 $ 0.50 For financial reporting purposes, the total amount of period costs incurred to sell 4 000 units is closest to Select one a $3,600 O b $8,000 ? $11.600 Od $7.700

Explanation / Answer

Answer is C. $11,600

Fixed selling expenses (4,000*$0.50) $    2,000 Fixed administrative expenses (4,000*$0.40) $    1,600 Sales commission (4,000*$1.50) $    6,000 Variable administrative expenses (4,000*$0.50) $    2,000 Total period cost $ 11,600

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