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Chloe's Cafe bakes croissants that it sells to local restaurants and grocery stores

Accounting

Chloe's Cafe bakes croissants that it sells to local restaurants and grocery stores. The average costs to bake the croissants are $0.35 for 3,200 and $0.30 for 6,400. 
Required: If the total cost function for croissants is linear, what will be the average cost to bake 5,600? (Do not round intermediate calculations. Round your final answer to 4 decimal places.) 
Average 
 

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Computation of Average Cost to bake 5600 units:

Unit Variable Cost = (6400*0.30 - 3200*0.35)/(6400-3200)

= 800/3200

= $0.25 per unit 

Fixed Cost = 6400 * (0.30-0.25) or 3200*(0.35-0.25) = $320

At 5,600,

Total Cost = Fixed Cost + Variable Cost

= $320 + (5,600*$0.25)

= $320 + $1,400

Total Cost = $1,720

 Average Cost to bake 5600 units = $1,720/5,600 = $0.3071

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