At a sales volume of 32,000 units, CD Company's total fixed costs are $64,000 and total variable costs are $60,000. The relevant range is 30,000 to 55,000 units.
-If CD Company sells 50,000 units,what is the total expected cost per unit (rounded to the nearest cent)?
A) $3.20.
B) $2.48.
C) $3.88.
D) $3.16.

Question

Quizplus · Accepted Answer

The total fixed costs remain constant at $64,000 within the relevant range. The variable cost per unit is $60,000 / 32,000 units = $1.875. For 50,000 units, total variable costs are 50,000 * $1.875 = $93,750. Total costs are $64,000 + $93,750 = $157,750. The cost per unit is $157,750 / 50,000 units = $3.155, rounded to $3.16.

At a Sales Volume of 32,000 Units, CD Company's Total