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20 May, 06:46

Johnston Company wants to double production of Product X from 1,000 units to 2,000 units. The variable manufacturing cost per unit is $10. The variable non manufacturing cost per unit is $20. There are no fixed costs. The selling price per unit is $50. What is the incremental cost of the proposed change?

A) $10,000B) $20,000C) $30,000

D) $60,000

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  1. 20 May, 07:36
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    Answer: C - $30,000

    Explanation: Johnston Company wants to double production of Product X from 1,000 units to 2,000 units.

    The variable manufacturing cost per unit is $10. The variable non manufacturing cost per unit is $20.

    The selling price per unit is $50

    To increase production by 1000 units

    Total cost is $10 + $20 = $30

    Total incremental cost = 1,000 * $30 = $30,000
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