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Pls can i get some assistance with the question. i cant seem to get the answer…
A company manufacturin a single product has the following cost at two different activity levels:
Activity level (units) 15,000 25,000
Total cost($) 94500 151000variable cost are constant at all activity levels,but fixed cost increase by $2000 every 10,000 units.What are the fixed costs at an activity level of 5,000 units
A $8,000
B $10,000
C$12,000
D$13,000Dear kpalmer,
Do u have the answer to this question? is the question even correct, cus i did try this enouhg n got into anything when came to calculate fixed cost
Try calculating Fixed cost above the 15000 units level and then once again calculate Fixed cost below the 15000 units level.
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there’s no sense in providing data for step up costs n then requiring an answer for the lowest of levels ..this question does’nt make sense at all, it could be above 50000 level of activity i suppose..
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