Thermal Technology, Inc. manufactures a special chemical used to coat certain electrical components that will be exposed
Question:
Thermal Technology, Inc. manufactures a special chemical used to coat certain electrical components that will be exposed to high heat in various applications. The company’s annual fixed production cost is $500,000.
Required:
1. Draw a graph of the company’s fixed production cost showing the total cost at the following production levels of the chemical: 50,000 liters, 100,000 liters, 150,000 liters, and 200,000 liters.
2. Prepare a table that shows the unit cost and the total cost for the firm’s fixed production costs at the following production levels: 1 liter, 50 liters, 50,000 liters, and 200,000 liters.
3. Prepare a graph that shows the unit cost for the company’s fixed production cost at the following production levels: 50,000 liters, 100,000 liters, 150,000 liters, and 200,000 liters.
Step by Step Answer:
Managerial Accounting Creating Value in a Dynamic Business Environment
ISBN: 978-0078025662
10th edition
Authors: Ronald Hilton, David Platt