Younger Corporation reports that at an activity level of 4,600 units, its total variable cost is $305,256 and its total fixed cost is $152,280

Answer to (a) and (d)

The average variable cost per unit is given by:

• = Existing total variable cost / existing activity level in units
• =$305,2564,600=$305,2564,600

• = $66.36 per unit

The total variable cost for 4,700 units is given by:

• = Average variable cost per unit * number of units
• = $66.36 * 4,700
• = $311,892

Answer to (b)

The total fixed cost does not change with the activity level within a relevant range and hence its value is $152,280.

Answer to (c)

The total cost is given by:

• = Total fixed cost + total variable cost
• = $152,280 + $311,892
• = $464,172

Answer to (e)

The average fixed cost per unit is given by:

• = Total fixed cost / new activity level in units
• =$152,2804,700=$152,2804,700

• = $32.40 per unit

Answer to (f)

The average total cost per unit is given by:

• = Average fixed cost per unit + average variable cost per unit
• = $32.40 + $66.36
• = $98.76 per unit