A firm produces and sells calendars. Last year, it produced 3,250 calendars and
ID: 1151108 • Letter: A
Question
A firm produces and sells calendars. Last year, it produced 3,250 calendars and sold each for $10. In producing these calendars, it incurred variable costs of $25 000 and a total cost of $48 000. What were the firm's fixed cost per calendar. Express your answer to the nearest cent. $ ____Please enter 2 digits after the decimal point. A firm produces and sells calendars. Last year, it produced 3,250 calendars and sold each for $10. In producing these calendars, it incurred variable costs of $25 000 and a total cost of $48 000. What were the firm's fixed cost per calendar. Express your answer to the nearest cent. $ ____
Please enter 2 digits after the decimal point.
Explanation / Answer
Total Cost= Variable cost + Fixed cost and so Fixed cost = Total cost - Variable cost
variable costs=$25000
Total cost=$48000
Thus Fixed cost=48000-25000=23000
Calendars produced=3250
Thus Fixed cost per calendar=23000/3250=7.08