The following cost formula relates to last year's operations at Lemine Manufacturing Corporation:
Y = $84,000 + $60.00X
In the formula above, 75% of the fixed cost and 90% of the variable cost are manufacturing costs. Y is the total cost and X is the number of units produced and sold.
-If Lemine produces and sells 7,000 units,what is the unit product cost under each of the following methods?
A)Option A
B)Option B
C)Option C
D)Option D

Question

The following cost formula relates to last year's operations at Lemine Manufacturing Corporation:
Y = $84,000 + $60.00X
In the formula above, 75% of the fixed cost and 90% of the variable cost are manufacturing costs. Y is the total cost and X is the number of units produced and sold. 
-If Lemine produces and sells 7,000 units,what is the unit product cost under each of the following methods? 
A)Option A 
B)Option B 
C)Option C 
D)Option D

Quizplus · Accepted Answer

Variable manufacturing cost = 0.90 F1F1F1S1F1F1F10 $60.00 = $54.00
Fixed manufacturing cost = 0.75 F1F1F1S1F1F1F10 $84,000 = $63,000
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The Following Cost Formula Relates to Last Year's Operations at Lemine