Business math problem
Hi guys, I'm stuck with this assignment....
if u can show me the solution step by step would be great!
Thanks in advance!
A local company has determined that it has the following cost structure: Fixed Costs 12,000U.S. D per month. Variable Costs 3.24U.S.D. per machine hour. It has been determined the machine hours are the most appropriate cost driver to use for determining the variable cost rate. For every hour that the machine is used the company incurs/shows an additional cost of 3.24 U.S.D.
1)What is the company's total cost for the month of March if they produce 17,320 units?
2)The company has an opportunity to reduce variable costs by 0.15U.S.D. per unit, but it
requires an increase in fixed costs of 1,000 U.S.D.per month by switching to a new production method. Normal production levels are 15,000 units per month. Should the company switch to the new method?
Ps: I know about the "we don't do your homework policy" but I don't even know where to start since the professor assign exercises unrelated to the study course.
if u can show me the solution step by step would be great!
Thanks in advance!
A local company has determined that it has the following cost structure: Fixed Costs 12,000U.S. D per month. Variable Costs 3.24U.S.D. per machine hour. It has been determined the machine hours are the most appropriate cost driver to use for determining the variable cost rate. For every hour that the machine is used the company incurs/shows an additional cost of 3.24 U.S.D.
1)What is the company's total cost for the month of March if they produce 17,320 units?
2)The company has an opportunity to reduce variable costs by 0.15U.S.D. per unit, but it
requires an increase in fixed costs of 1,000 U.S.D.per month by switching to a new production method. Normal production levels are 15,000 units per month. Should the company switch to the new method?
Ps: I know about the "we don't do your homework policy" but I don't even know where to start since the professor assign exercises unrelated to the study course.
Risposte
Welcome in the Forum 
I have substituted the dollar symbol with U.S.D. since the usual symbol switches on the MathML mode , used for writing formulas.
The exercise seems very simple ; a tentative solution would be appreciated
I have substituted the dollar symbol with U.S.D. since the usual symbol switches on the MathML mode , used for writing formulas.
The exercise seems very simple ; a tentative solution would be appreciated
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