Reference no: EM131811949

Question 1. Bozeman Corporation manufactures a single product. Monthly production costs incurred in the manufacturing process are shown below for the production of 3,200 units. The utilities and maintenance costs are mixed costs.The fixed portions of these costs are $266 and $260, respectively.

Production in Units 3,200

Production Costs

Direct materials $7,506

Direct labor 14,994

Utilities 1,834

Property taxes 1,080

Indirect labor 7,292

Supervisory salaries 1,752

Maintenance 1,156

Depreciation 2,415

Calculate the expected costs when production is 5,300 units.

Question 2. The Lake Shore Inn is trying to determine its break-even point. The inn has 50 rooms that are rented at $62 per night. Operating costs are as follows:

Salaries $7,436 per month

Utilities $1,431 per month

Depreciation $1,268 per month

Maintenance $377 per month

Maid Service $9 per room

Other Costs $29 per room

Determine the inn's break-even point in (1) number of rented rooms per month and (2) dollars.