Perteet Corporation’s relevant range of activity is 3,600 units to 8,000 units. When it produces and…
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Question “Perteet Corporation’s relevant range of activity is 3,600 units to 8,000 units. When it produces and…”
Answer
If 4400 units were produced by the company, we need to calculate total manufacturing overhead costs.
Manufacturing overhead costs include both fixed overhead and variable overhead.
We were given the cost per unit for 5800 units in the question.
It should be noted that fixed cost remain fixed regardless of the number. It is important to note that fixed costs remain fixed regardless of the number.
Fixed manufacturing overhead cost = 5800 units * 3.30 =$19.140. This is the cost per unit for 5800 units, but it is fixed for n units unless specified otherwise.
Variable Manufacturing overhead can vary depending on the number of units produced. Variable Manufacturing overhead will vary depending on the number of units produced. Variable manufacturing overhead = = 4,400 units * 1.40 = $6,160
Total Manufacturing Overhead Cost = $19,140 + $6.160 = $25,000.
Conclusion
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