Question

Sa Saved Help Required information The Foundational 15 (LO1-1, L01-2, LO1-3, LO1-4, LO1-5, LO1-6) [The following information applies to the questions displayed below) Martinez Company's relevant range of production is 7,500 units to 12,500 units. When it produces and sells 10,000 units, its average costs per unit are as follows: 15 ped 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 $6.00 $3.50 $1.50 $4.00 $3.00 $2.00 $1.00 se.50 sook Foundational 1-4 4. If 12.500 units are produced and sold, what is the variable cost per unit produced and sold? (Round your answer to 2 decimal places.) Variable cost per unit sold

Answer 1

The relevant range refers to a specific activity level that is bounded by a minimum and maximum amount. Within the designated boundaries, certain revenue or expense levels can be expected to happen. Outside of that relevant range, revenues and expenses will likely differ from the expected amount.

Now answering to question

Calculation of variable cost per unit if 12500 unit produced and sold

Direct material direct labour variable manufacturing overhead sales commissions variable administartive expense Total Cost $6.00 $3.50 $1.50 $1.00 $0.50 $12.50

Martinez company's realevamt range of production is 7500 units to 12500 units there will no change in per unit variable cost while producing 12500 units , all variable cost same as the variable cost on production of 10000 units , if  Martinez company's produced units more than 12500 units then there will change in per unit cost of production.

Hence per unit varible cost for 12500 units produced will be  $12.50 per unit.