I have a question regarding 2011 Q 1 (c)How are variable costs of $ 5346 and fixed costs of $1980 being calculated
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June 2011 Q1 (c)
5y ago#1The answer appendix shows variable costs as: 36 labour ($18 x 2 hrs) VOH $12 x 2hrs = 24 and parts 75. So Total variable = 135.
9% of units need repair so: 9% x 440,000 x 135 = 5,343,000
Fixed = $ x 2hrs x 440,000 x 9% = 1,980,000
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