Chapter 2 Assignment Solution

Chapter 2 Assignment Solution - Problem 2-20A (continued)...

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Chapter 2 Homework handed in Problem 2-20A a. Sales Volume in units (a) 100 150 200 250 300 Total cost of software (a x $200) $20,000 $30,000 $40,000 $50,000 $60,000 Total cost of booth rental 7,500 7,500 7,500 7,500 7,500 Total cost of sales (b) $27,500 $37,500 $47,500 $57,500 $67,500 Average cost per unit (b ÷ a) $275 $250 $237.50 $230 $225 The cost of booth space is fixed. b. Sales Volume 100 150 200 250 300 Average cost per unit (a) $275 $250 $237.50 $230 $225 Price per package (a + $60) $335 $310 $297.50 $290 $285
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Unformatted text preview: Problem 2-20A (continued) c. Trade Shows Attended (a) 1 2 3 4 5 Cost of booth rental (a x $7,500) $7,500 $15,000 $22,500 $30,000 $37,500 The cost of booth space is variable. d. The additional cost is $40 50 units = $0.80 per unit. The cost would be treated as a variable cost for decision making purposes. While it is not purely proportional, its behavior pattern closely approximates a variable cost pattern....
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This note was uploaded on 11/05/2008 for the course ACC U301 taught by Professor Udihoitash during the Fall '08 term at Northeastern.

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