Andretti Company has a single product called a Dak. The company normally produce
ID: 2431191 • Letter: A
Question
Andretti Company has a single product called a Dak. The company normally produces and sells 99,000 Daks each year at a selling price of $71 per unit. The company’s unit costs at this level of activity follow:
Just need the answers for question 4 and 5 ...... thanks
Andretti Company has a single product called a Dak. The company normally produces and sells 99,000 Daks each year at a selling price of $71 per unit. The company’s unit costs at this level of activity follow:
Just need the answers for question 4 and 5 ...... thanks
Explanation / Answer
4) Contribution margin lost (4950*10.1) -49995 fixed costs fixed manufacturing overhead cost (495000*2/12)*40% 33000 fixed selling cost (346,500*2/12)*20% 11550 44550 net disavantage of closing the plant -5445 99000*2/12*30%= 4950 units 5) Variable manfuacturing costs 55.8 fixed manufacturing overhead cost (5*25%)= 2.8 variable selling expense 3.5*2/3 2.33 total costs avoided 60.93