LM Enterprises produces a single part for sale. The part sells for $15.5 per unit. Fixed costs are $1,420,000 annually. Production and sales of 640,000 units annually result in profit before taxes of $2,420,000. What is the unit variable cost?

LM Enterprises produces a single part for sale. The part sells for $15.5 per unit. Fixed costs are $1,420,000 annually. Production and sales of 640,000 units annually result in profit before taxes of $2,420,000. What is the unit variable cost?

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter16: Cost-volume-profit Analysis

Section: Chapter Questions

Problem 36P: Faldo Company produces a single product. The projected income statement for the coming year, based...

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Question

What is the unit variable cost?

LM Enterprises produces a single part for sale.
The part sells for $15.5 per unit. Fixed costs are
$1,420,000 annually. Production and sales of
640,000 units annually result in profit before
taxes of $2,420,000. What is the unit variable
cost?

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