Final answer:
The average cost per item is calculated by dividing the total cost of production by the number of items produced. After subtracting the fixed cost from the total cost, the remaining variable cost is used in the calculation. The average cost per item in this scenario is $24.29. Option C is correct.
Step-by-step explanation:
To find the average cost per item when the fixed cost is $300, and the cost to produce 70 items is $1700, we first calculate the total cost of production, which includes both fixed and variable costs. In this case, the fixed cost is given as $300, and the total cost to produce 70 items is $1700. Therefore, the total variable cost for producing the 70 items would be $1700 - $300 = $1400. Next, we find the average cost per item by dividing the total cost by the number of items produced:
- Total Variable Cost = Total Cost - Fixed Cost
- Total Variable Cost = $1700 - $300
- Total Variable Cost = $1400
- Average Cost per Item = Total Cost divided by Number of Items
- Average Cost per Item = $1700 / 70
- Average Cost per Item = $24.29
So, the correct answer is C) $24.29.