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3 December, 11:22

Rec Equipment incurred $58,500 in total costs when it produced 9,000 balls. Total fixed costs are $36,000. What is the total cost when it produces 12,000 balls? A. $78,000.00 B. $62,500.00 C. $30,000.00 D. $66,000.00

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Answers (1)
  1. 3 December, 11:30
    0
    The correct answer is option (D).

    Explanation:

    According to the scenario, the given data are as follows:

    Total Cost = $58,500

    Total units = 9,000

    Total fixed cost = $36,000

    So, we can calculate the total cost for 12,000 balls by using following formula:

    Total Cost for 12,000 balls = (12,000 * Variable cost per unit) + Fixed cost

    Where, variable cost per unit = (Total cost - Fixed cost) : Total units

    = ($58,500 - $36,000) : 9,000 = $2.5

    By putting the value, we get

    Total Cost for 12,000 balls = (12,000 * $2.5) + $36,000

    = $66,000.
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Home » Business » Rec Equipment incurred $58,500 in total costs when it produced 9,000 balls. Total fixed costs are $36,000. What is the total cost when it produces 12,000 balls? A. $78,000.00 B. $62,500.00 C. $30,000.00 D. $66,000.00
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