Question & Answer: Martinez Company's relevant range of production is 7,500 units to 12,500 units. When it produces and sells 10,0…..

15 Martinez Companys relevant range of production is 7,500 units to 12,500 units. When it produces and sells 10,000 units, its average costs per unit are as follows: Average cost Per Unit $5.60 $3.10 $1.40 $4.00 $2.60 $2.20 $1.20 s0.45 Part 15 of 15 Direct materials Direct Labor Variable manufacturing overhead Pixed manufacturing overhead Pixed sel1ing expense Pixed administrative expense Sales commissions variable administrative expense 0.36 points eBook Foundational 1-15 15. What incremental manufacturing cost will Martinez incur if it increases production from 10,000 to 10,001 units? (Round your answer to 2 decimal places.)

Martinez Company’s relevant range of production is 7,500 units to 12,500 units. When it produces and sells 10,000 units, its average costs per unit are as follows: What incremental manufacturing cost will Martinez incur if it increases production from 10,000 to 10,001 units? (Round your answer to 2 decimal places.) Incremental cost per unit produced

Expert Answer

 

Solution :- Incremental manufacturing cost per unit produced = Direct material cost per unit + Direct labor cost per unit + Variable manufacturing overhead per unit.

= 5.60 + 3.10 + 1.40

= $ 10.10

Conclusion :- Incremental manufacturing cost per unit produced = $ 10.10 (approx).

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