Given the cost formula Y = $12,000 + $6X, what is the total cost at an activity level of 8,000 units?Multiple Choice$20,000$12,000$60,000$48,000
Question
Given the cost formula
what is the total cost at an activity level of 8,000 units?
Multiple Choice
- $20,000
- $12,000
- $60,000
- $48,000
Solution
The formula given is Y = 6X. This is a cost formula where Y is the total cost, X is the number of units, 6 is the variable cost per unit.
Step 1: Identify the given values. Here, X = 8,000 units.
Step 2: Substitute the given value of X into the formula. So, Y = 6 * 8,000.
Step 3: Perform the multiplication. 48,000.
Step 4: Add the fixed cost to the result of the multiplication. So, Y = 48,000 = $60,000.
So, the total cost at an activity level of 8,000 units is $60,000.
Similar Questions
At a production level of 5,600 units, a project has total costs of $89,000 and a variable cost per unit of $11.20. What is the amount of the total fixed costs?
A firm produces five units of output at an average cost of $20 per unit. The cost of the sixth unit is$26.What is the average cost of six units?
Total costs are $140,000 when 10,000 units are made. Of this amount, variable costs are $4 per unit. What are the total costs when 8,000 units are produced?
7) If the incremental method were used, what amount of cost would be allocated to the start-upbusiness?A) $20,000B) $54,000C) $60,000D) $74,000
If you know that total fixed cost is $200, total variable cost is $600, and total product is 4 units, then average total cost must be
Upgrade your grade with Knowee
Get personalized homework help. Review tough concepts in more detail, or go deeper into your topic by exploring other relevant questions.