Strait Co. manufactures office furniture. During the most productive month of the year, 3,200 desks were...

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Strait Co. manufactures office furniture. During the most productive month of the year, 3,200 desks were manufactured at a to

Answer 1

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Answer #1

Variable cost per unit = (Highest activity cost - Lowest activity cost)/(Highest activity - Lowest activity)

= ( 83,200-63,600)/(3,200-1,120)

= 19,600/2,080

= $9.42 per unit

Fixed cost = Highest activity cost - Highest activity x Variable cost per hour

= 83,200 - 3,200 x 9.42

= 83,200-30,144

= $53,056

First option is correct option.

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Answer 2

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