Chapter 1, Problem 15F15

L01-2, L01-3, L01-4, L01-5, L01-6

Martinez Company’s relevant range of production is 7,500 units to 12,500 units. When it produces and sells 10,000 units, its average costs per unit are as follows:

	Average Cost per Unit
Direct materials	$6.00
Direct labor	$3.50
Variable manufacturing overhead	$1.50
Fixed manufacturing overhead	$4.00
Fixed selling expense	$3.00
Fixed administrative expense	$2.00
Sales commissions	$1.00
Variable administrative expense	$0.50

Required:

15. What incremental manufacturing cost Martinez incur if it increases production from 10,000 to 10,001 units?