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Generic Motors Company

Generic Motors Company
Generic Motors Company wants to estimate its fixed costs and unit variable costs based on the following information for 2009. Its production volume for 2009 was 200 units.

Cost account Amount fixed/variable?
direct labor $6,000 (1=fixed, 2=variable)
direct materials $5,200 (1=fixed, 2=variable)
depreciation $9,700 (1=fixed, 2=variable)
rent $6,000 (1=fixed, 2=variable)
administrative staff salaries $10,300
(1=fixed, 2=variable)
Required:

a) Classify each cost account above as fixed or variable (none of them is mixed).

Enter your answers in the table above (enter 1 for fixed and 2 for variable costs)

b) Estimate fixed costs and unit variable costs using account classification method:

FC=$ unit VC=$

c) Based on the estimates from (b), what is the total cost of producing 250 units?

$

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