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If 18,000 units are produced and sold, what is the variable cost per unit produced and sold?2. if 22,000 units are produced and sold, what is the variable cost per unit produced and sold?3. if 18,000 units are produced and sold, what is the total amount of variable cost related to the units produced and sold?4. if 22,000 units are produced and sold, what is the total amount of variable cost related to the units produced and sold?5. if 18,000 units are produced, what is the average fixed manufacturing cost per unit produced?6. if 22,000 units are produced, what is the average fixed manufacturing cost per unit produced?7. if 18,000 units are produced, what is the total amount of fixed manufacturing overhead incurred to support this level of production?8. if 22,000 units are produced, what is the total amount of fixed manufacturing overhead incurred to support this level of production?

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Answer:

1) total variable cost per unit $14

2) total variable cost per unit $14

3) total variable cost = $14 x 18,000 = $252,000

4) total variable cost = $14 x 22,000 = $308,000

5) average fixed manufacturing cost = $100,000 / 18,000 units = $5.56 per unit

6) average fixed manufacturing cost = $100,000 / 22,000 units = $4.55 per unit

7) total fixed manufacturing overhead = $100,000

8) total fixed manufacturing overhead = $100,000

Explanation:

The company's variable costs for producing 20,000 units

  • direct labor cost is $4 per unit
  • direct material is $7 per unit
  • variable manufacturing overhead $1.50 per unit
  • sales commissions $1 per unit
  • variable administrative expense $0.50 per unit
  • total variable cost per unit = $14

The company's variable costs for producing 20,000 units

  • fixed manufacturing overhead $5 x 20,000 = $100,000
  • fixed selling expense $3.50 x 20,000 = $70,000
  • fixed administrative expense $2.50 x 20,000 = $50,000
  • total fixed costs $220,000

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Based on the information given, it should be noted that the variable cost per unit will be $14.

Calculation of the Variable Cost.

The variable cost per unit will be:

= Direct materials + Direct labor + Variable manufacturing overhead + Sales commission + Variable administrative expenses

= 7 + 4 + 1.5 + 1 + 0.5

= 14

The total amount of variable cost will be:

= 14 × 18000

= $252000

When 22,000 units are produced and sold, the total amount of variable cost will be:

= 22000 × 14 = $308000

The average fixed cost manufacturing cost per unit will be:

= (20000 × 5)/18000

= 5.56

When 22,000 units are produced, the average fixed manufacturing cost per unit produced will be:

= (20000 × 5)/22000

= 4.55

The total amount of fixed manufacturing overhead incurred will be:

= 20000 × 5

= $100000.

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