SmokeCity, Inc., manufactures barbeque smokers. Based on past experience, SmokeCity has found that its total annual overhead costs can be represented by the following formula: Overhead cost = $520,475 + $1.49X, where X equals number of smokers. Last year, SmokeCity produced 19,100 smokers. Actual overhead costs for the year were as expected. Required: 1. What is the driver for the overhead activity? For questions 2-4, Enter the final answers rounded to the nearest dollar. 2. What is the total overhead cost incurred by SmokeCity last year? $fill in the blank 2 3. What is the total fixed overhead cost incurred by SmokeCity last year? $fill in the blank 3 4. What is the total variable overhead cost incurred by SmokeCity last year?
SmokeCity, Inc., manufactures barbeque smokers. Based on past experience, SmokeCity has found that its total annual
Required:
1. What is the driver for the overhead activity?
For questions 2-4, Enter the final answers rounded to the nearest dollar.
2. What is the total overhead cost incurred by SmokeCity last year?
$fill in the blank 2
3. What is the total fixed overhead cost incurred by SmokeCity last year?
$fill in the blank 3
4. What is the total variable overhead cost incurred by SmokeCity last year?
$fill in the blank 4
For questions 5-7, round your answers to the nearest cent. Use those rounded figures in subsequent computations, if necessary.
5. What is the overhead cost per unit produced?
$fill in the blank 5 per unit
6. What is the fixed overhead cost per unit?
$fill in the blank 6 per unit
7. What is the variable overhead cost per unit?
$fill in the blank 7 per unit
8. Recalculate Requirements 5, 6, and 7 for the following levels of production: (a) 18,800 units and (b) 20,800 units. Round your answers to the nearest cent.
18,800 Units | 20,800 Units | |
---|---|---|
Unit cost | $fill in the blank 8 | $fill in the blank 9 |
Unit fixed cost | fill in the blank 10 | fill in the blank 11 |
Unit variable cost | fill in the blank 12 | fill in the blank 13 |
The reason the unit costs changed in the way they did is because:
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