Bubbly Soda spends 2 on direct materials direct labor and va

Bubbly Soda spends $2 on direct materials, direct labor, and variable manufacturing overhead for every unit (12-pack of soda) it produces. Fixed manufacturing overhead oosts $7 million per year. The plant, which is ert den tartopa e any charge ent plans to operato doser to ful capaoty not year, produ n 35 milion unts. Manage ently operaéng at oly 75%of y, predod 25 mil nnts his year. Manager the prices it pays for materials, labor, and manufacturing overhead Current average Current year\'s produced units product cost per unit million S 228 pr uni Total product costs 57 25 Requirement 3. What is the ourrent fxed cost per uni? Determine the formula, then caloulate the current fxed cost per unit. (Enter your answer to the nearest cent) Total fixed oosts Current fxed cost per unit 02per uni Current yoars produced units milion 25 milion Requirement 4. What is the forecasted total product oost next year (for the 35 million units), including fxed and variable costs? Determine the formula, then caloulate the forecasted total product cost next year (for the 35 milion units) Forecasted total product costs milion milion milion

Solution

total product cost = total variable cost + total fixed cost

total product cost = 70 + 7 = 77 million

total variable cost = units produced* cost per unit = 35 millions *2 = 70 millions

total fixed cost = 7 millions