Schonhardt Corporation\'s relevant range of activity is 3,000 units to 7,000 uni

Question

Schonhardt Corporation's relevant range of activity is 3,000 units to 7,000 units. When it produces and sells 5,000 units, its average costs per unit are as follows Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Fixed selling expense Fixed administrative expense Sales commissions Variable administrative expense Average Cost per Unit $7. 75 $3. 20 $1.80 $3. 30 S1. 10 $0. 80 $0. 90 $0. 80 If 6,000 units are produced, the total amount of fixed manufacturing cost incurred is closest to Multiple Choice $16,500 $16,500 $22,000 $24,000

Explanation / Answer

Total fixed manufacturing overheads=(3.3*5000)=$16500

Total Fixed manufacturing overhead cost do not change with change in units.

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