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At current sales volume of 100 units, fixed costs (FC) are $4 per unit and variable...

At current sales volume of 100 units, fixed costs (FC) are $4 per unit and variable costs (VC) are $8 per unit.

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Answer #1

1.

Total Fixed cost = 100 units *4 = $400

2.

Total fixed cost $400
Fixed cost per unit($400/125) $3.2
VC per unit $8
Total VC($8*125) $1,000

3.

TC = $400 + $8*Volume

Total cost at 80 units = $1,040

Total cost at 120 units = $1,360

4.

Total cost = $400 + $8*101

= $1,208

($1,208 - $1,200) =$8

Option A. Is correct.

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