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Category > Accounting Posted 20 Sep 2017 My Price 6.00

Spirit Company

13. LO.2 (Cost behavior) Spirit Company produces baseball caps. The company incurred the following costs to produce 12,000 caps last month:

 

Cardboard for the brims

$ 4,800

Cloth

12,000

Plastic for headbands

6,000

Straight-line depreciation

7,200

Supervisors’ salaries

19,200

Utilities

3,600

Total

$52,800

a. What did each cap component cost on a per-unit basis?

b. What is the probable type of behavior that each of the costs exhibits?

c. The company expects to produce 10,000 caps this month. Would you expect each type of cost to increase or decrease? Why? Can the total cost of 10,000 caps be determined? Explain.

Answers

Maurice Tutor
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Status NEW Posted 20 Sep 2017 03:09 PM My Price 6.00

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