Question

Mauro Products sells a woven basket for $15 per unit. Its variable expense is $12 per unit and the company's monthly fixed expense is $4,200. What is the total expense for the company if it sells 100 units of the woven basket?

1) $1,200
2) $1,500
3) $4,200
4) $6,000

Answer 1

The total expense for Mauro Products is $6000 if it sells 100 units of the woven basket.

Step-by-step explanation:

To calculate the total expense for Mauro Products if it sells 100 units of the woven basket, we need to consider both the variable and fixed expenses. The variable expense per unit is $12, and since they are selling 100 units, the total variable expense would be 100 * $12 = $1200.

The fixed expense for the company is $4200 per month, regardless of how many units are sold. Therefore, the total expense for the company would be the sum of the variable and fixed expenses, which is $1200 + $4200 = $5400.

So, the correct answer is option 4) $6000.