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3 December, 15:46

Sophie Corporation recently produced and sold 100,000 units. Fixed costs at this level of activity amounted to $50,000; variable costs were $100,000. How much cost would the company anticipate if during the next period it produced and sold 102,000 units?

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  1. 3 December, 17:14
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    Total cost = $152,000

    Explanation:

    Giving the following information:

    Sophie Corporation recently produced and sold 100,000 units. Fixed costs at this level of activity amounted to $50,000; variable costs were $100,000.

    Production = 102,000 units

    We will assume that the fixed costs remain in the relevant range.

    Fixed costs = 50,000

    Variable costs = 102,000*1 = 102,000

    Total cost = $152,000
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