Feathered Nests produces decorative birdhouses.The company's average cost per unit is $20.00 when it produces 2,000 birdhouses.If $4,800 of the total costs are fixed,what is the variable cost of producing each birdhouse?

Question

Quizplus · Accepted Answer

Variable cost = Total cost - Fixed cost= $20.00 x 2,000 - $4,800= $40,000 - $4,800= $35,200Variable cost per unit = $35,200 / 2,000= $17.60

Feathered Nests Produces Decorative Birdhouses