A company produces 200 units with a total fixed cost of $10,000 and a variable c

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Question: A company produces 200 units with a total fixed cost of $10,000 and a variable cost of $15 per unit. What is the total cost?

Options:

Correct Answer: $10,000

Solution:

Total cost = Total fixed cost + (Variable cost per unit * Number of units) = $10,000 + ($15 * 200) = $13,000.

A company produces 200 units with a total fixed cost of $10,000 and a variable cost of $15 per unit. What is the total cost?

A company produces 200 units with a total fixed cost of $10,000 and a variable cost of $15 per unit. What is the total cost?

Step 1: Identify the total fixed cost, which is $10,000.
Step 2: Identify the variable cost per unit, which is $15.
Step 3: Identify the number of units produced, which is 200.
Step 4: Calculate the total variable cost by multiplying the variable cost per unit by the number of units: $15 * 200.
Step 5: Perform the multiplication: $15 * 200 = $3,000.
Step 6: Add the total fixed cost to the total variable cost: $10,000 + $3,000.
Step 7: Perform the addition: $10,000 + $3,000 = $13,000.
Step 8: The total cost is $13,000.

Total Cost Calculation – Understanding how to calculate total cost by adding fixed costs to variable costs multiplied by the number of units produced.