Question: Are the following Fixed costs or Variable costs? If it is a Fixed Cost, is it a recurring Fixed cost or one-time Fixed cost? 1.

Are the following Fixed costs or Variable costs? If it is a Fixed Cost, is it a recurring Fixed cost or one-time Fixed cost?

1. Honda will build a SUV manufacturing plant in Thailand at an estimated cost of $360 Million.

2. The labor costs of producing each SUV are $5000.

3. Honda will offer a cash rebate of 10% to every buyer.

4. Honda will run an advertising campaign of $142,880,000 to launch the new SUV in the US market.

5. The salaries and overhead costs are $320,000 per month.

6. The raw material costs are $4200 per SUV.

Honda's selling price is $28,000 per truck.

7. What is the Unit Contribution Margin for Honda's SUV?

Honda can produce 9,000 trucks per month.

8. How long will it take Honda to Breakeven? At Breakeven, what is Honda's sales volume?

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