Erkkila Incorporated Reports That at an Activity Level of 6,600

question 324

Multiple Choice

Erkkila Incorporated reports that at an activity level of 6,600 machine-hours in a month, its total variable inspection cost is $426,230 and its total fixed inspection cost is $188,301.What would be the average fixed inspection cost per unit at an activity level of 6,900 machine-hours in a month? Assume that this level of activity is within the relevant range.

• A) $93.11
• B) $28.53
• C) $37.29
• D) $27.29