The Controller for Truman Canoes Has Gathered the Following Cost

question 20

Essay

The controller for Truman Canoes has gathered the following cost and activity level information:
$$\begin{array} { | l | r | } \hline \text { Average total cost per unit } & \$ 300.00 \\\hline \text { Production level used to calculate average cost } & 2,000 \\\hline \text { Total fixed costs } & \$ 100,000 \\\hline\end{array}$$ a.What is the total cost of producing 2,000 fiberglass canoes?
b.What is the variable cost of producing each fiberglass canoe?
c.Suppose the controller uses the average cost to predict total costs.What total cost would the controller calculate for 3,000 fiberglass canoes?
d.If the controller uses the cost equation to predict total costs,what total cost would the controller calculate for 3,000 fiberglass canoes?
e.Is there a difference between the forecasted total cost using average cost versus the cost equation? If there is a difference,what creates the difference? If there is no difference,when would there be a difference?

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Definitions:

Class Action

A legal procedure that allows many people with similar grievances to combine their lawsuits into one action against a common defendant.

Plurality Action

A decision-making process or election outcome determined by the largest fraction of votes, even if it does not constitute a majority.

Amicus Curiae

A legal term referring to someone not a party to a case who offers information, expertise, or insight that has a bearing on the issues in the case.

Federal Appellate Courts

Courts within the federal judicial system that have the authority to review decisions made by lower courts, ensuring the correct application of law without conducting trials.