The Wood River plant of the Union Company has a normal capacity of 90,000 units per...

 

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The Wood River plant of the Union Company has a normal capacity of 90,000 units per month. Monthly production costs are $12 variable per unit and $240,000 fixed. By increasing the fixed cost $10,000 a month, the plant can produce 95,000 units. Required: (1) Differential cost of the production between 80% and 90% of normal capacity. (2) Differential cost of producing the 5,000 units above normal capacity. (3) Per unit total production cost of the 5,000 units, rounded to the nearest cent. (4) Per unit differential production cost of the 5,000 units. The Wood River plant of the Union Company has a normal capacity of 90,000 units per month. Monthly production costs are $12 variable per unit and $240,000 fixed. By increasing the fixed cost $10,000 a month, the plant can produce 95,000 units. Required: (1) Differential cost of the production between 80% and 90% of normal capacity. (2) Differential cost of producing the 5,000 units above normal capacity. (3) Per unit total production cost of the 5,000 units, rounded to the nearest cent. (4) Per unit differential production cost of the 5,000 units.

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