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Argon Corp. had capacity to produce 30,000 units of L3 using 60,000 kg of direct...

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Accounting

Argon Corp. had capacity to produce 30,000 units of L3 using 60,000 kg of direct materials. Argon produced 29,700 units of L3 by processing 56,500 kg of direct materials. Conversion cost per unit is $7.50. Argon can add or reduce manufacturing capacity in increments of 3500 kgs. What would be the cost savings if Argon decides to reduce manufacturing capacity by 3500 kgs?

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