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23 June, 00:36

Curt's Casting manufactures metal parts in a large manufacturing facility. Curt's customers order 52,000 tons of castings each quarter. The facility has a practical capacity of 84,000 tons. Curt leased the current facility because it was more convenient than another new facility that had a capacity of 52,000 tons. The annual cost of the facility is $336,000. The variable cost of a casting is $5. Required: a. What cost per casting should the cost system report?

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  1. 23 June, 01:25
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    The cost per casting that the cost system should report is $9.

    Explanation:

    Cost per casting = Variable + Fixed

    = $5 + ($336,000/84,000 tons)

    = $5 + $4

    = $9

    Therefore, The cost per casting that the cost system should report is $9.
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