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COST BEHAVIOR
For each unit of product, Heavy Company has the following costs: Direct materials, P100; Direct labor, P280; Variable overhead, P70. The company has a monthly normal capacity of 1,500 units where it incurs fixed production costs of P75,000.
Required:
Problem 1. Compute for the total production cost and the cost per unit of product if the company is able to produce 1,200 units.
Problem 2. Compute for the total production cost and the cost per unit of product if the company is able to produce 1,500 units.
Problem 3. Compute for the total production cost and the cost per unit of product if the company is able to produce 100 units.
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