Vin diesel owns the fredonia barber shop. he employs 7 barbers and pays each a base rate of $1,560 per month. one of the barbers serves as the manager and receives an extra $510 per month. in addition to the base rate, each barber also receives a commission of $5.89 per haircut. other costs are as follows. advertising $250 per month rent $990 per month barber supplies $0.47 per haircut utilities $170 per month plus $0.20 per haircut magazines $20 per month vin currently charges $11.56 per haircut. determine the variable costs per haircut and the total monthly fixed costs. (round variable costs to 2 decimal places, e. g. 2.25.) total variable cost per haircut $ total fixed $

The variable cost per unit is $6.56

The total monthly fixed cost is $12,860

Explanation:

The computation of variable cost per hair cut is equals to

= Barber supplies per haircut + utilities per haircut + commission per hair cut

= $0.47 + $0.20 + $5.89

= $6.56

Thus, the variable cost per unit is $6.56

Now, the total monthly fixed cost is equals to

= Barber base rate + extra salary for manager + advertising + rent + utilities + magazine

where,

Barber base rate is =  base rate × number of barbers

                                = $1,560 × 7

                                = $10920

And other values are given in the question

So, put these values in the above equation

Thus, the monthly Fixed cost is equals to

= $10,920 + $510 + $250 + $990 + $170 + $20

= $12,860

Hence, the total monthly fixed cost is $12,860