Fixed & Variable Cost Output Question?
Fixed & Variable Cost Output?
Wine Output(.75-Liter Bottles)
10,000 Bottles ///// 15,000 Bottles //// 20,000 Bottles
Variable production costs…
$35,000 //////// 52,500 ////////// 70,000
Fixed production costs…...
100,000 //////// 100,000 ////////// 100,000
Variable selling and administrative costs...
2,000 ////////// 3,000////////// 4,000
Fixed selling and administrative costs..
40,000 ///////// 40,000////////// 40,000
Total……
$177,000 //////// $195,000 ////////// $214,000
Wine Sales
10,000 Bottles ///// 15,000 Bottles ///// 20,000 Bottles
Sales price per .75-liter bottle…
$18.00 ///// 15.00 ///// $12.00
Can anyone help me Calculate the company's PROFIT at each level of production.
And assuming that the company will sell all of its output. At what production level is profit maximized?
Answers:
For 2 (maybe 10) points?!?
Figure the ranges, it is like a box. The top of this, the bottom of that, and you define your supply curve for that product. The industry supply curve is then the aggregate of ranges for all the producers. I'll let you do the math, though.
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