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The Janice Company Has Provided the Following Information Using the Information Provided, Compute the Total Cost Function and Units

Question 170

Essay

The Janice Company has provided the following information:  Units of Output 20,00032,000 Direct materials $180,000$252,000 Workers’ wages 1,080,0001,512,000 Supervisors’ s al aries 312,000312,000 Equipment 151,200151,200 depreciation  Maintenance $1,600110,400 Utilities 384,000528,000 Total $2,188.800$2865.600\begin{array}{lll}\text { Units of Output }&20,000&32,000\\\text { Direct materials } & \$ 180,000 & \$ 252,000 \\\text { Workers' wages } & 1,080,000 & 1,512,000 \\\text { Supervisors' s al aries } & 312,000 & 312,000 \\\text { Equipment } & 151,200 & 151,200 \\\text { depreciation } & &\\\text { Maintenance } & \$ 1,600 & 110,400 \\\text { Utilities } & \underline{384,000} & \underline{528,000} \\\text { Total } & \$ 2,188.800 & \$ 2865.600\end{array} Using the information provided, compute the total cost function and estimate the total cost at 27,000 units of output.

Correct Answer:

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Variable cost = ($2,865,600 $2,188,800) ...

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