Chapter $10$ Assignment

$10-23$ Cost$-$volume$-$profit and regression analysis. $($LO $1,2)$ Garvin Corporation manufactures a children's bicycle, model CT$8.$ Garvin currently manufactures the bicycle frame. During $2023,$ Garvin made $30,000$ frames at a total cost of $$900,000.$ Ryan Corporation has offered to supply as many frames as Garvin wants at a cost of $$28\mathrm{.}50$ per frame. Garvin anticipates needing $36,000$ frames each year for the next few years.

Required

$1.$

What is the average cost of manufacturing a bicycle frame in $2023?$ How does it compare to Ryan's offer?

Can Garvin use the answer in requirement la to determine the cost of manufacturing $36,000$ bicycle frames? Explain.