The Following Information Summarizes the Company's Cost Structure Assume That All of the Activity Levels Mentioned in This

question 81

Essay

The following information summarizes the company's cost structure
$\begin{array}{|l|r|}\hline \text { Variable cost per unit } & \$ 1.30 \\\hline \text { Fixed cost per unit } & \underline{4.50} \\\hline \text { Total cost per unit } & \$ 5.80 \\\hline \text { Units produced and sold } & 48,000 \\\hline\end{array}$
Assume that all of the activity levels mentioned in this problem are within the relevant range.
Required:
Prepare a schedule showing predictions for the following items at the 40,000 unit level of activity:
a)Total variable cost.
b)Total fixed cost.
c)Variable cost per unit.
d)Fixed cost per unit.

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Definitions:

Labor

The effort by humans to produce goods or services in exchange for wages or other forms of compensation.

Total-Product Schedule

A table showing the output or total product resulting from various quantities of inputs or resources, used in production theory.

Marginal Revenue Product

The increase in revenue resulting from the utilization of one extra unit of a factor of production.

Resource

An economic or productive factor required to accomplish an activity or as means to undertake an enterprise and achieve desired outcome.