Computing Fixed, Variable, and Total Unit Costs
Calwood Manufacturing anticipates producing 1,450 wagons with total budgeted costs of $18,824. Of this amount, $5,600 is considered to be fixed.
A. Write the cost equation in standard form.
B. If Calwood produces 1,400 wagons, how much are total fixed costs?
C. If Calwood produces 1,460 wagons, how much are total fixed costs?
D. How much is variable cost per wagon if 1,400 wagons are produced and sold?
E. How much is total variable cost if 1,400 wagons are produced and sold?
F. If 1,520 wagons are produced and sold, what is the expected total cost?
G. If the company produces and sells 1,520 wagons, what is the unit cost of each wagon?
H. What if the company produces and sells 1,700 wagons, what happens to the unit cost of each wagon compared to the unit cost in part G?