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24 September, 09:46

Cinram machines has the following estimates for its new gear assembly project: price = $1,340 per unit; variable costs = $348 per unit; fixed costs = $5.1 million; quantity = 82,000 units. suppose the company believes all of its estimates are accurate only to within ± 5 percent. what value should the company use for its total variable costs when performing its best-case scenario analysis

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  1. 24 September, 11:42
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    Given:

    Price per unit : 1,340

    variable cost per unit: 348

    fixed cost: 5.1 million

    quantity produced: 82,000 units

    estimate: + 5 percent

    Total variable cost: (82,000) (1.05) (348) (0.95) = 28,464,660

    Considering the accuracy of the estimate, the total variable cost is $28,464,660.00
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