Compute the unit manufacturing cost for the daytime shift

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Reference no: EM131807894

Venus Computer can produce 23,000 personal computers a year on its daytime shift. The fixed manufacturing costs per year are $2 million and the total labor cost is $9,109,000. To increase its production to 46,000 computers per year, Venus is considering adding a second shift. The unit labor cost for the second shift would be 25% higher than the day shift, but the total fixed manufacturing costs would increase only to $2.4 million from $2 million.

(a) Compute the unit manufacturing cost for the daytime shift.

(b) Would adding a second shift increase or decrease the unit manufacturing cost at the plant?

Reference no: EM131807894

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