Question

A jeans maker is designing a new line of jeans called slams. slams will sell for $205 per unit and cost $164 per unit in variable costs to make. fixed costs total $60000. What is the total cost to produce 300 units of slams?

1) $49,200
2) $49,500
3) $49,800
4) $50,000

Answer 1

To find the total cost to produce 300 units of Slams, multiply the variable cost per unit by 300 and add the fixed costs. The calculation is 300 units × $164 per unit + $60,000 fixed costs, equaling $109,200. The options given seem incorrect as they do not match this calculation.

Step-by-step explanation:

To calculate the total cost to produce 300 units of Slams, a new line of jeans designed by a jeans maker, we need to account for both fixed costs and variable costs. The variable cost per unit is given as $164, and the fixed costs total is $60,000.

The variable cost for 300 units is:
300 units × $164/unit = $49,200

Now, add the fixed costs to find the total cost:
$49,200 (total variable cost for 300 units) + $60,000 (fixed costs) = $109,200

Thus, the total cost to produce 300 units of Slams is $109,200, which is not one of the provided options. This means there might be a mistake in the question or the options listed.