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Koala Enterprises Inc. relevant range of activity is 4,800 units to 6,000 units. When it...

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Accounting

Koala Enterprises Inc. relevant range of activity is 4,800 units to 6,000 units. When it produces and sells 5,400 units, its average costs per unit are as follows:

Average Cost Per Unit

Direct materials

$

8.05

Direct labor

$

3.80

Variable manufacturing overhead

$

2.10

Fixed manufacturing overhead

$

3.50

Fixed selling expense

$

1.40

Fixed administrative expense

$

1.10

Sales commissions

$

1.20

Variable administrative expense

$

1.10

If 5,000 units are produced, the total amount of fixed manufacturing cost incurred is closest to:

Multiple Choice:

A. $18,900

B. $26,460

C. $22,680

D. $32,400

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