Last month,when 10,000 units of a product were manufactured,the cost per unit was $60.At this level of activity,variable costs are 50% of total unit costs.If 10,500 units are manufactured next month and cost behaviour patterns remain unchanged,the total cost of goods manufactured will be?

Question

Quizplus · Accepted Answer

First, we need to calculate the total cost per unit:
Total unit cost = $60 / (1 - 0.5) = $120
Next, we can calculate the cost of goods manufactured for next month:
Cost of goods manufactured = Total unit cost * Number of units manufactured
Cost of goods manufactured = $120/unit * 10,500 units
Cost of goods manufactured = $1,260,000
Therefore, the answer is C) $615,000.

Last Month,when 10,000 Units of a Product Were Manufactured,the Cost