Relevant Range and Fixed and Variable Costs Vogel Inc. manufactures memory chips
ID: 2522465 • Letter: R
Question
Relevant Range and Fixed and Variable Costs
Vogel Inc. manufactures memory chips for electronic toys within a relevant range of 114,000 to 182,400 memory chips per year. Within this range, the following partially completed manufacturing cost schedule has been prepared:
Complete the cost schedule below. When computing the cost per unit, round to two decimal places. Round all other values to the nearest dollar.
Components produced 114,000 144,000 182,400 Total costs: Total variable costs . . . . . . . . . $49,020 (d) (j) Total fixed costs . . . . . . . . . . . . 54,720 (e) (k) Total costs . . . . . . . . . . . . . . . . . $103,740 (f) (l) Cost per unit: Variable cost per unit . . . . . . . (a) (g) (m) Fixed cost per unit . . . . . . . . . . (b) (h) (n) Total cost per unit . . . . . . . . . . (c) (i) (o)Explanation / Answer
Ans. Components produced 114000 144000 182400 Total costs: Total variable costs 49020 61920 78432 Total Fixed costs 54720 54720 54720 Total costs 103740 116640 133152 Cost per unit: Variable cost per unit 0.43 0.43 0.43 Fixed cost per unit 0.48 0.38 0.30 Total cost per unit 0.91 0.81 0.73 *Calculations: Components produced 114000 144000 182400 Total costs: Total variable costs 49020 (49020/114000*144000) (49020/114000*182400) Total Fixed costs 54720 54720 54720 *Fixed costs are always remain constant. *Total cost = Variable cost + Fixed cost Cost per unit: Variable cost per unit (49020/114000) (61920/144000) (78342/182400) Fixed cost per unit (54720/114000) (54720/144000) (54720/182400) *Total cost per unit = Variable cost per unit + Fixed cost per unit