A company recorded the following production costs during the previous two-week period: | ||||
Week 1 | Week 2 | |||
Direct labor costs | 17,000 | 33,000 | ||
Other manufacturing costs | 25,000 | 48,333 | ||
Units produced | 3,000 | 7,000 | ||
Assuming both weeks fall in the same relevant range, what was the total fixed cost during Week 1? | ||||
Answer: | ||||
Answer
1)FIXED COST =TOTAL COST -VARIABLE COST
week 1 | week 2 | Changes in cost | Variable cost per unit | |
Direct labor costs | 17,000 | 33,000 | 16,000 | 4 |
Other manufacturing costs | 25,000 | 48,333 | 23,333 | 5.83325 |
Units produced | 3000 | 7000 |
week 1 | |
Direct labor costs | 17,000 |
Other manufacturing costs | 25,000 |
Total cost | 42,000 |
(Less :variable cost) | |
a)Direct labour | $ (12,000) |
b)Other manufacturing costs | $ (17,499.75) |
FIXED COST | $ 12,500.25 |
A company recorded the following production costs during the previous two-week period: Week 1 Week 2...
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