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Business, 25.11.2021 08:20 feliciagraham14
A car manufacturer produces three models of vehicle, X, Y and Z. It has calculated the
costs of these three products to be as follows:
Ñ…
Y
N
Z
Variable material costs ($ m) 5
10
8
Variable labour costs ($ m) 10
14
6
Allocated fixed costs ($ m) 9
12
6
Annual output of vehicles 4000
12000
5000
The total variable cost of manufacturing Model X = $ 15 million
Total cost of manufacturing Model X = $15 million + $9 million = $24 million
$24 000 000 - $6000 per vehicle
The average cost per unit of X = .
4000 units
a Calculate the total variable cost of manufacturing vehicle Models Y and Z.
b Calculate the total cost of manufacturing Models Y and Z.
c Calculate the average cost of manufacturing Models Y and Z.
d Identify and explain two possible uses of these results to managers of the car
manufacturer
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Answers: 3
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A car manufacturer produces three models of vehicle, X, Y and Z. It has calculated the
costs of th...
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