Answer:
$1.83
Step-by-step explanation:
Fixed costs are those costs which are not output dependent. Are fixed till certain level of production. It doesn’t depend on the level of activity or output.
$550.000 / 300.000 units = $1.83 fix costs per unit
Total costs are equal to total fixed costs plus total variable costs.
Per unit, the equation is:
Total costs per unit = (total fixed costs / units of production) + unit variable costs.
First scenario
Total costs = total fixed costs + total variable costs.
$612.000 = $550.000 + total variable costs.
Total costs per unit = (total fixed costs / units of production) + unit variable costs
$612.000/215.000 units = ($550.000/215.000) + unit variable costs
$2.84 - $2.56 = unit variable costs
$0.29 = unit variable costs
Second scenario
Total costs = total fixed costs + (unit variable costs * units of production)
Total costs = $550.000 + ($0.29 * 300.000)
Total costs = $550.000 + $87.000
Total costs = $637.000