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7) REX HAS THE FOLLOWING COST DATA: UNITS = 14,800 VC/UNIT = $10 FC/UNIT = $28 FIXED COST INCREASE 25 PERCENT AT 17,000 UNITS

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Answer #1

FC/Unit at 20000 units = $ 28 + 0.25 \times $ 28

FC/Unit at 20000 units = $ 35

Total cost is the sum of the fixed and variable costs.

Total cost per unit at 20000 units = VC / unit + FC / unit

Total cost per unit at 20000 units = $ 10 + $ 35

Total cost / unit = $ 45

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