| | APRIL 20X8 | MAY 20X8 | | | | | | | Per Unit | No. of Units | Total Cost |
| Production units of Mini Y | 3000 | 3200 | | | | | | Fixed cost | 48,000 | 300 | 4,500,000 |
| Cost Per Unit | $17,167 | $16,875 | | | | | | Variable cost | | | 14,400,000 |
| Components Cost(variable) | $ 24,000,000.00 | $ 25,600,000.00 | | | | | | Total cost | | | 18,900,000 |
| Labour Cost (variable) | $ 13,500,000.00 | $ 14,400,000.00 | | | | | | No. of Units | | | 300 |
| | | | | | | | | Cost per Unit | | | 63,000 |
| Rent (fixed) | $ 6,000,000.00 | $ 6,000,000.00 | | | | | | Mark Up | | | 18,900 |
| Depreciation (fixed) | $ 6,000,000.00 | $ 6,000,000.00 | | | | | | Selling Price | | | 81,900 |
| Other (fixed) | $ 2,000,000.00 | $ 2,000,000.00 |
| Total | $ 51,500,000.00 | $ 54,000,000.00 | | | | | | If IPS manage to sale 300 units then they will be able to earn 30% mark up corver cost at $81,900 per unit |
| | | | | | | | | This mark up will decrease if the sell less than 300 units because fixed cost will remain the same. |
| Less depreciation | | $ 6,000,000.00 |
| Cash paid Production Cost | | $ 48,000,000.00 |
| Keeping the variable cost per unit and the fixed cost at the same level, would result in IPS spending $2.5 million more to |
| produce 200 more units in may. The cost per unit decreased because you are selling more production units |
| which will result in a lower cost per unit |
iikotu
step_5_update.xlsx
