Question

Selected financial data for Spark Enterprises follows for a production level of 120,000 units: (4 points) Total fixed costs $300,000 Total costs (fixed and variable) $450,000 a.​Calculate the variable cost per unit. B.​If Flash Corporation makes 75,000 units, calculate the fixed cost per unit. C.​If Flash Corporation makes 160,000 units, calculate the total variable costs. D.​If Flash Corporation makes 180,000 units, calculate the total costs.

Answer 1

Instructions are below.

Step-by-step explanation:

Giving the following information:

Total fixed costs= 300,000

Total costs= $450,000

Units= 120,000

A) Unitary variable cost= 150,000/120,000= $1.25

B) Units= 75,000

The fixed costs remain constant no matter how many units are made (between relevant ranges).

Total fixed costs= $300,000

C) UNits= 160,000

Total variable costs= 1.25*160,000= $200,000

D) Units= 180,000

Total fixed costs= 300,000

Total variable costs= 1.25*180,0000= 225,000

Total costs= $525,000