Martinez company's relevant range of production is 8,900 units to 13,900 units when it produces and sells 11,400 units its unit cost are as follows: Direct material Direct labor 6.70 4.20 Variable manufacturing overhead 1.40 Fixed manufacturing overhead 4.70 Fixed administrative expenses 3.70 Sales commission 2.10 Variable administrative expense 0.55 What is the total amount of product costs incurred to make 11,400 units? QUESTION: Southern Mfg., Inc., is currently operating at only 94 percent of fixed asset capacity. Current sales are $740,000. Fixed assets are $450,000 and sales are projected to grow to $860,000. How much in new fixed assets are required to support this growth in sales? Assume the company maintains its current operating capacity.
Martinez company's relevant range of production is 8,900 units to 13,900 units when it produces and sells 11,400 units its unit cost are as follows: Direct material Direct labor 6.70 4.20 Variable manufacturing overhead 1.40 Fixed manufacturing overhead 4.70 Fixed administrative expenses 3.70 Sales commission 2.10 Variable administrative expense 0.55 What is the total amount of product costs incurred to make 11,400 units? QUESTION: Southern Mfg., Inc., is currently operating at only 94 percent of fixed asset capacity. Current sales are $740,000. Fixed assets are $450,000 and sales are projected to grow to $860,000. How much in new fixed assets are required to support this growth in sales? Assume the company maintains its current operating capacity.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Transcribed Image Text:Martinez company's relevant range of production is 8,900 units to
13,900 units when it produces and sells 11,400 units its unit cost are as
follows:
Direct material
Direct labor
6.70
4.20
Variable manufacturing overhead 1.40
Fixed manufacturing overhead
4.70
Fixed administrative expenses
3.70
Sales commission
2.10
Variable administrative expense
0.55
What is the total amount of product costs incurred to make 11,400
units?
QUESTION:
Southern Mfg., Inc., is currently operating at only 94
percent of fixed asset capacity. Current sales are $740,000.
Fixed assets are $450,000 and sales are projected to grow
to $860,000. How much in new fixed assets are required to
support this growth in sales? Assume the company
maintains its current operating capacity.
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