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Title: Variable or Fixed Cost

Essay Details:

Subject: Business
Author: Martha B
Date: February 20, 2015
Level:
Grade: B
Length: 1 / 218

Essay text:

Using this we can calculate expected costs if production increases. For 6000 hamburgers annually the cost of raw materials is $3900 while at 8000 hamburgers it is $5200. Since the facility rent is unchanged with respect to the number of hamburgers. It's per unit cost decreases respectively. 6000 hamburgers is $1.50 per unit and at 8000 it is $1.13. Where as in the beginning the rent overhead is $9.00 per unit. To produce 6000 hamburgers annually there would be $9000 in fixed rent costs plus $3900 in raw materials, totaling $12900 annually. To produce 8000 hamburgers annually there would be $9000 in fixed rent costs plus $5200 in raw materials, totaling $14200 annually...

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