HW1_2_3sol

HW1_2_3sol - FC Period VC Period FC Difference = Product...

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ACG 2071 Homework Problems Problem 1 Total costs = Fixed costs + Variable costs $40,000 = VC + 12,000 so VC = $28,000 at 6,000 units A. Fixed costs are the same no matter what happens to production/sales levels. Fixed costs = $12,000 B. Fixed costs = $12,000 C. Variable costs per unit are the same no matter what level of production/sales. Variable costs + Fixed costs = total costs VC per unit = $28,000/6,000 = $4.666666666 per unit = $4.67 per unit D. VC per unit * 6,300 units = $4.666666666*6,300 = $29,400 E. At 6,800 units: VC = $4.66666 * 6,800 = $31,733 FC = 12,000 Total cost at 6,600 units $43,733 Problem 2 Period or Product Variable or Fixed Period FC Product VC Period VC Period FC Period
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Unformatted text preview: FC Period VC Period FC Difference = Product costs are costs to get inventory(products) ready to sell Period costs are all other costs not used to get inventory (products) ready to sell Problem 3 1 A. Opportunity cost $3,000, the amount given up if manufactured B. Sunk cost $120,000 C. Product cost $0.08 per pencil for materials and $0.04 for labor (overhea D. Not incremental Fixed costs of $10,800 and depreciation on factory space E. Fixed costs Fixed costs of $10,800 and depreciation on factory space F. Variable costs $0.08 materials per pencil, $0.04 labor per pencil and $0.01 delivery per pencil ad would also be included here if given)...
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HW1_2_3sol - FC Period VC Period FC Difference = Product...

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