Question

Perteet Corporation's relevant range of activity is 6,600 units to 13,000 units. When it produces and sells 9,800 units, its average costs per unit are as follows: Average Cost per Unit Direct materials $ 7.30 Direct labor $ 3.70 Variable manufacturing overhead $ 1.80 Fixed manufacturing overhead $ 3.10 Fixed selling expense $ 0.70 Fixed administrative expense $ 0.40 Sales commissions $ 0.50 Variable administrative expense $ 0.55 If 7,300 units are produced, the total amount of manufacturing overhead cost is closest to:

Answer 1

Total overhead cost= $43,520

Step-by-step explanation:

Giving the following information:

Variable manufacturing overhead $ 1.80

Fixed manufacturing overhead $ 3.10

First, we need to calculate the total fixed overhead:

Total fixed overhead= 3.1*9,800 = $30,380

Now, the total overhead cost for 7,300 units:

Total variable overhead= 7,300*1.8= 13,140

Total fixed overhead= 30,380

Total overhead cost= $43,520