Axelrod Company has fixed costs of $250,000. Highest production volume this year was in January when there were 100,000 units produced and total costs of $550,000. In June, the company produced only 60,000 units. How much was the total cost in June?

Question

Quizplus · Accepted Answer

B) Calculations:
$550,000 - $250,000 = $300,000
$300,000/100,000 = $3.00
60,000 × $3.00 = $180,000
$180,000 + $250,000 = $430,000

Axelrod Company Has Fixed Costs of $250,000