Question

Rhonda Corporation's relevant range of activity is 3,000 units to 6.000 units. When it produces and sells 4,000 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 $ 5.40 $ 3.55 $ 1.70 $ 3.85 $ 0.60 $ 0.40 $ 1.00 $ 0.40 If 5,000 units are produced and sold, the fixed manufacturing overhead cost per unit is closest to: Multiple Choice o $4.85 $3.85 $5.55 $3.08

Answer 1

B Amount A 1 1) 2 Particulars 3 Total fixed manufacturing overhead 4 Number of units produced 5 Fixed manufacturing overhead cost per unit $ 15,400 5,000 $ 3.08 6 7 Hence, the correct option is $3.08. 8 9 2) 10 Particulars 11 Cosmetics Department Sales commissions-Stardust store 12 Cosmetics Department cost of sales Stardust Store 13 Cosmetics Department Manager's salary - Stardust Store 14 Total amount of direct costs of Cosmetics Department 15 16 Hence, the correct option is 42,380. Amount $ 5,000 $ 32,700 $ 4,680 $ 42,380

A B Amount 1 1) 2 Particulars 3 Total fixed manufacturing overhead 4 Number of units produced 5 Fixed manufacturing overhead cost per unit =3.85*4000 5000 =+B3/B4 6 7 Hence, the correct option is $3.08. 8 9 2) 10 Particulars 11 Cosmetics Department Sales commissions-Stardust store 12 Cosmetics Department cost of sales Stardust Store 13 Cosmetics Department Manager's salary - Stardust Store 14 Total amount of direct costs of Cosmetics Department Amount 5000 32700 4680 =+B11+B12+B13 15 16 Hence, the correct option is 42,380.

Answer 2

Number one is D.