Note can you explain the equation for each table because I need to Know. how you get the Variable Cost of $2.375 per square feet built Total Cost number of square feet built and total cost per square feet built

Case Study Fixed and Variable Cost Behavior Harpers Inc. has a construction depot. Constructing the depot is the responsibility of the manufacturing department.

Two of the resources needed to construct the depot are labor and building supplies. The cost driver for both resources is square feet built. Depot building laborers are paid the same wages regardless of the number of times the depot is built.

Building supplies is a variable cost. A standard 45,000 square foot plant is built from four to eight times a month depending on the level and stage of manufacturing.

For the most recent month, June, four depots were built. The June cost of labor was $30,000 and building supplies used cost $9,500.

The manufacturing schedule for the next quarter (July through September) indicates a depot has to be built five, six, and eight times respectively.

Requirements for Fixed cost/ Variable Cost

Prepare table that shows how labor cost, building supplies cost, total cost, and total cost per square feet-built changes in response to the square feet built. What is the predicted total cost of depot building for the next quarter?

2. Suppose Harpers can hire an outside manufacturing company to build the depot as needed. The charge rate for building is $6,100 per depot. If the outside manufacturing company is hired, Harpers can lay off the workers who are now building the depot and will spend nothing for building supplies. Will Harpers save money with the outside manufacturing company over the next quarter? Prepare a schedule that supports your answer.

3. At what level of activity (SqFt built) will the two options be equal?