Use the Following Information for Items

question 4

Short Answer

Use the following information for items
The Colin Division of Mochrie Company sells its product for $30 per unit.Variable costs per unit are: manufacturing, $12; and selling and administrative, $2.Fixed costs are: $200,000 manufacturing overhead, and $50,000 selling and administrative.There was no beginning inventory.Expected sales for next year are 40,000 units.Ryan Stiles, the manager of the Colin Division, is under pressure to improve the performance of the Division.As he plans for next year, he has to decide whether to produce 40,000 units or 50,000 units.
-What would the anufacturing cost per unit be under variable costing for each alternative?

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Definitions:

Average Total Cost Curve

A graphical representation showing the average total cost of producing different quantities of a good or service.

Industry Demand Curve

A graphical representation showing the total demand for the products or services of a particular industry at various price levels.

Government Franchising

A process by which a government grants a company the exclusive right to operate, produce, or sell a service within a certain area.

Legal Barriers

Restrictions established by law or regulation that control how businesses operate, often to limit competition or protect consumers.