Big Thumbs Company _Fixed & Variable costs

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Big Thumbs Company manufactures portable flash drives for computers. Big Thumbs incurs monthly depreciation costs of $15,900 on its plant equipment. Also, each drive requires materials and manufacturing overhead resources. On average, the company uses 18,500 ounces of materials to manufacture 7,400 flash drives per month. Each ounce of material costs $3.00. In addition, manufacturing overhead resources are driven by machine hours. On average, the company incurs $29,600 of variable manufacturing overhead resources to produce 7,400 flash drives per month.

Total cost of flash drives = $____ + ($_____ x Number of flash drives)

2.  If the department expects to manufacture 6,000 flash drives next month, what is the expected fixed cost (assume that 6,000 units is within the company's current relevant range)?

What is the total variable cost (assume that 6,000 units is within the company's current relevant range)?

 

 

What is the total manufacturing cost (i.e., both fixed and variable) (assume that 6,000 units is within the company's current relevant range)?

    • 11 years ago
    Big Thumbs Company _Fixed & Variable costs
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