homework 2 - Exercise 3.10 Cost Behavior SmokeCity Inc manufactures barbeque smokers Based on past experience SmokeCity has found that its total annual

homework 2 - Exercise 3.10 Cost Behavior SmokeCity Inc...

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Cost Behavior Required: # Of Smokers For questions 2-4, Enter the final answers rounded to the nearest dollar. Overhead = 543,000+ 1.34(20,000) 569800 543,000 26800 1.34(20,000) For questions 5-8, round your answers to the nearest cent. 28.49 Per Unit =543,000+1.34(20,000)/20,000 27.15 Per Unit =543,000/20,000 1.34 Per Unit 19,500 21,600 Unit cost 569130 29.19 571944 26.48 Unit fixed cost 27.85 25.14 Unit variable cost 1.34 1.34 The reason the unit costs changed in the way they did is because: When the units of production dropped the fixed costs weren't spread out as much so the price per unit i When the units of production increased the fixed costs were spread out more and the price per unit dec Exercise 3.10 SmokeCity, Inc., manufactures barbeque smokers. Based on past experience, SmokeCity has found that i overhead costs can be represented by the following formula: Overhead cost = $543,000 + $1.34X, where smokers. Last year, SmokeCity produced 20,000 smokers. Actual overhead costs for the year were as exp 1. What is the driver for the overhead activity? 2. What is the total overhead cost incurred by SmokeCity last year? 3. What is the total fixed overhead cost incurred by SmokeCity last year?
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