BE10 - Homework 10 Brief Exercises BE23-1 1 Indirect labor...

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Homework # 10 Brief Exercises BE23-1 1) Indirect labor - variable costs. The activity level grew twice this type of costs increased twice too. 2) Supervisory salaries - fixed costs. This type of costs is independent from the level of activity. 3) Maintanance - mixed costs. Despite the fact that activity level grew twice this type of costs increased 1,5 times only. So, we can conclude that some part of these costs is fixed and while the other is variable. BE23-2 Range of productivity 40% 80% Variable cost 2,000 4,000 Fixed cost 6,000 6,000 BE23-3 500 2,500 Dollars 40,000 40,000 Hours 8,000 40,000 40% 80% 0 500 1,000 1,500 2,000 2,500 3,000 3,500 4,000 4,500 2,000 4,00 Variable cost Range of Productivity Cost 40% 80 0 1,000 2,000 3,000 4,000 5,000 6,000 7,000 Fixed cost Range of Productivity Cost 30,000 40,000 50,000 Mixed costs Row 48 ars
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BE23-4 The difference in miles is 1000 The difference in total cost is 1700 = / 1.7 = 1700 / 1000 Activity Level High Law Total cost 15,000 13,300 Less: Variable costs 8 500*1.7 14450 7 500*1.7 12750 Total fixed costs 550 550 Mixed costs are therefore $550 per month and $1.7 per mile BE23-5 a) 90 b) 36% c) 300 d) 40% e) 1,200 f) 840 BE23-6 a) In units: $400Q = $260Q + $168 000 + $0 $140Q = $168 000 Q = 1 200 Minot Company must sell 1 200 units to break even. In dollars: 1 200*400 = $480 000
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