axwell Company has a total expense per unit of $2.00 per unit at the 16,000-unit level of activity, and a total expense per unit of $1.95 at the 21,000-unit level of activity. What is
Variance Analysis
In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for the variance so that the necessary steps should be taken to correct that variance.
Standard Costing
The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.
Maxwell Company has a total expense per unit of $2.00 per unit at the 16,000-unit level of activity, and a total expense per unit of $1.95 at the 21,000-unit level of activity.
What is the best estimate of the total fixed cost for Maxwell Company?
Multiple Choice:
a) 32,000
b) 40,950
c) 3,360
d) 29,190
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