Reference no: EM132533665
Total production costs of prior periods for a company are listed below. Assume that the same cost behavior patterns can be extended linearly over the range of 3,000 to 35,000 units and that the cost driver for each cost is the number of units produced.
Production in units per month 3,000 9,000 16,000 35,000
Cost X $23,700 $ 52,680 $ 86,490 $178,260
Cost Y 47,280 141,840 252,160 551,600
Question 1 : What is the average cost per unit at a production level of 8,000 units for cost X?
Option A. $5.98
Option B. $5.85
Option C. $7.90
Option D. $4.83