Wray Chairs Corporation produces ergonomically designed chairs favored by architects. The company normally produces and sells from 4,000 to 10,000 chairs per year. The following cost data apply to various production activity levels:

Required
a. Complete the preceding table by filling in the missing amounts for the levels of activity shown in the first row of the table.
b. Explain why the total cost per chair decreases as the number of chairsincreases.

Transcribed Image Text:

Number of Chairs 2,000 3,000 4,0005,000 Total costs incurred $60,000 20,000 $80,000 Fixed Variable Total costs Per-unit chair cost Fixed Variable $ 30.00 10.00 40.00 Total cost per chair