Indicate the fixed cost within the relevant range.Fixed cost Pharoah Enterprises is considering manufacturing a new product. It projects the cost of direct materials and rent for a range of outputas follows.Outputin Units1,0002,000RentCost$6,9406,9403,000 11,1044,000 11,1045,00011,1046,000 11,1047,000 11,1048,000 11,1049,000 13,88010,000 13,88011,000 13,880DirectMaterials$5,5506,0006,0008,00010,00012,00014,00016,00040,66848,58061,072

Variable Cost : It is considered as the cost which varies with the level of production.…

Answered: haroah Enterprises is considering…

haroah Enterprises is considering manufacturing a new product. It projects the cost of direct materials and rent for a range of output s follows.

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter5: Process Costing

Section: Chapter Questions

Problem 8MC: What is the conversion cost to manufacture insulated travel cups if the costs are: direct materials,...

See similar textbooks

Related questions

Q: Which of the following best describes a fixed cost? a. Cost representing a fixed proportion of…

A: Fixed Cost: It is a cost that does not change with the change in the level of output. It is the…

Q: Why are product costs sometimes called inventoriable costs? Describe the flow of such costs ina…

A: Product costs: The costs incurred to acquire the merchandise, ship the stock, prepare the…

Q: You have been asked to install a costing system in a manufacturing company. What practical…

A: Cost accounting is the branch of accounting that inspects the cost structure of a business. This…

Q: Total cost is a combination of fixed and variable costs. The algebraic equation, where T =…

A: Provide the algebraic equation for total cost.

Concept explainers

Overheads

In cost accounting, overhead refers to those expenses which occur during the operating of a business. Overhead includes the fixed, variable, or semi-variable which is not directly involved with a company product or service. It is very important to analyze overhead expense as it helps the company in determining how much a company must charge for its products and services so that they can generate profit. Overhead expenses depend upon the nature of the business operations.

Question

Indicate the fixed cost within the relevant range.
Fixed cost

Pharoah Enterprises is considering manufacturing a new product. It projects the cost of direct materials and rent for a range of output
as follows.
Output
in Units
1,000
2,000
Rent
Cost
$6,940
6,940
3,000 11,104
4,000 11,104
5,000
11,104
6,000 11,104
7,000 11,104
8,000 11,104
9,000 13,880
10,000 13,880
11,000 13,880
Direct
Materials
$5,550
6,000
6,000
8,000
10,000
12,000
14,000
16,000
40,668
48,580
61,072

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

Pharoah Enterprises is considering manufacturing a new product. It projects the cost of direct materials and rent for a range of output as follows. Output in Units 1,000 2,000 Rent Cost $6,940 6,940 3,000 11,104 4,000 11,104 8,000 5,000 11,104 6,000 11,104 7,000 11,104 11,104 9,000 13,880 10,000 13,880 11,000 13,880 Direct Materials $5,550 6,000 6,000 8,000 10,000 12,000 14,000 16,000 40,668 48,580 61,072
Paxton company can produce a component given answer accounting questions
Can you please give answer the accounting question?
Compute the net incremental cost or saving of buying the component
Paxton company can produce a component of its product solve this question accounting
Assume that Vista Tech Industries has the following available information about costs: please answer the general accounting question
S
Want answer
What is the conversion cost to manufacture insulated travel cups if the costs are: direct materials, $17,000; direct labor, $33,000; and manufacturing overhead, $70,000? A. $16,000 B. $50,000 C. $103,000 D. $120000
The following product Costs are available for Haworth Company on the production of chairs: direct materials, $15,500; direct labor, $22.000; manufacturing overhead, $16.500; selling expenses, $6,900; and administrative expenses, $15,200. What are the prime costs? What are the conversion costs? What is the total product cost? What is the total period cost? If 7,750 equivalent units are produced, what is the equivalent material cost per unit? If 22,000 equivalent units are produced, what is the equivalent conversion cost per unit?
Define the following terms with example. RELEVANT COSTSUNK COSTOPPORTUNITY COSTAVOIDABLE AND UNAVOIDABLE COSTINCREMENTAL COSTBREAK-EVEN POINT(B)KPR manufactures installs lawn sod in home yards. The company’s most recent monthly contribution format income statement follows: In RsAmount Sales 80,000 Variable expenses 32,000 Contribution margin 48,000 Fixed expenses -38,000 Net operating income 10,000 Required:Compute the company’s degree of operating leverage.Using the degree of operating leverage, estimate the impact on net operating income of a 5% increase in sales.Verify your estimate from part (2) above by constructing a new contribution format income statement for the company assuming a 5% increase in sales.
Paxton Company can produce a component of its product that incurs the following costs per unit: direct materials, $10.50; direct labor, $14.50, and incremental overhead $3.50. An outside supplier has offered to sell the product to Paxton for $37.00. Compute the net incremental cost or savings of buying the component. Multiple Choice $3.50 cost per unit $8 5 savings per unit. $0 cost or savings per unit $8.50 cost per unit. $3.50 savings per unit