Chapter+10+Problems - Chapter 10 Problems 1 ABC Inc Manufactures biotech sunglasses The variable materials cost \$1.43 per unit and the variable labour

# Chapter+10+Problems - Chapter 10 Problems 1 ABC Inc...

This preview shows page 1 - 2 out of 2 pages.

Chapter 10 Problems 1- ABC Inc. Manufactures biotech sunglasses. The variable materials cost \$1.43 per unit and the variable labour cost is \$2.44 per unit. a- What is the variable cost per unit? (\$3.87) b- Suppose the firm incurs fixed costs of \$650,000 during a year in which total production is 320,000 units. What are the total costs for the year? (\$1,888,400) c- If the selling price is \$10 per unit, what is the cash break-even point? If depreciation is \$190,000 per year, what is the accounting break-even point? (106,036 units; 137,031 units) 2- XYZ Corp. can manufacture mountain climbing shoes for \$16.51 per pair in variable raw material costs and \$18.50 per pair in variable labour expense. The shoes sell for \$105 per pair. Last year, production was 150,000 pairs. Fixed costs were \$800,000. Calculate the following: total production costs, marginal cost per pair and average cost. If the company is considering a one-time order for an extra 10,000 pairs, what is the minimum acceptable total revenue from the order? (\$6,051,500; \$35.01; \$40.34; \$350,100) 3- Louise Inc. has the following estimates for its new gear assembly project: price = \$1,900  #### You've reached the end of your free preview.

• • • 