Question

Martinez Company's relevant range of production is 7,500 units to 12,500 units. When It produces and sells 10,000 unlts, Its average costs per unlt are as follows: Average Cost Per Unit $6.10 $3.60 $1.40 Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Fixed selling expense Fixed administrative expense Sales commissions Variable administrative expense $ 4.00 $3.10 $ 2.10 $1.10 $ 0.55 Foundational 1-5 5, ir 8,000 u produced and sold? (Do not round intermediate calculetions.) nits are produced and sold, what is the total amount of varlable costs related to the unilts Total variable cost

Answer 1

Ans.	Variable cost relate to Units Produced:
	Particulars			Amt.($)
	Direct materials			48,800
	Direct Labor			28,800
	Variable manufacturing overhead			11,200
	Total Variable cost			$    88,800
	Variable cost relate to Units Sold:
	Particulars			Amt.($)
	Sales Commission			8,800
	Variable administrative expense			4,400
	Total Variable cost			$    13,200
	Total Variable cost =		88,800 + 13,200
	=		$ 102,000