Question

The following costs were for Optimal View Inc., a contact lens manufacturer:

Output	Fixed Cost		Variable Cost		Total Costs
270	$	5,300	$	10,000	$	15,300
320		5,300		12,000		17,300
370		5,300		14,000		19,300
420		5,300		16,000		21,300

At an output level of 500 lenses, per unit total cost is projected to be:

Multiple Choice

• $44.45.

• $49.00.

• $38.05.

• $55.27.

• $47.16.

Answer 1

Variable cost per unit = 10,000/270 = 37.03

Total Cost for 500 units = (500*37.03) + 5,300 = 23, 845

Cost per unit = 23,845/500 = 47.69

OPTION E IS THE ANSWER (nearest number)