fixed and variable cost determinations 426012

The projected cost of a lamp is calculated based upon the projected increases or decreases to
current costs. The present costs to manufacture one lamp are:

	Lamp Kit:	$16.0000000	per lamp
	Direct Labor:	2.0000000	per lamp (4 lamps/hr.)
	Variable Overhead:	2.0000000	per lamp
	Fixed Overhead:	10.0000000	per lamp (based on normal capacity of 25,000 lamps)

	Cost per lamp:	$30.0000000	per lamp

Expected increases for 20×2
When calculating projected increases round to TWO ($0.00) decimal places.

	1. Material Costs are expected to increase by 5.50% .

	2. Labor Costs are expected to increase by 2.50%.

	3. Variable Overhead is expected to increase by 6.50%.

	4. Fixed Overhead is expected to increase to $290,000.

	5. Fixed Administrative expenses are expected to increase to $56,000.

	6. Variable selling expenses (measured on a per lamp basis) are expected to increase
	by 4.50%.

	7. Fixed selling expenses are expected to be $37,000 in 20×2.

	8. Variable administrative expenses (measured a per lamp basis) are expected to
	increase by 5.00%.

On the following schedule develop the following figures:
	1 20×2 Projected Variable Manufacturing Unit Cost of a lamp.

	2 20×2 Projected Variable Unit Cost per lamp.

	3 20×2 Projected Fixed Costs.