The incremental manufacturing cost that the company will incur if it increases production from 4,000 to 4,001 units is closest to:

A) $16.00
B) $14.05
C) $10.45
D) $13.45

Question

The incremental manufacturing cost that the company will incur if it increases production from 4,000 to 4,001 units is closest to:A) $16.00B) $14.05C) $10.45D) $13.45

Jamila Authement · Accepted Answer

Final Answer : C, Explanation :  To find the incremental manufacturing cost, we need to calculate the cost of producing 4,001 units and subtract the cost of producing 4,000 units.Cost of producing 4,000 units:$7,500 + ($2.50 × 4,000) = $17,500Cost of producing 4,001 units:$7,500 + ($2.50 × 4,001) = $17,510.50Incremental manufacturing cost:$17,510.50 - $17,500 = $10.50 ≈ $10.45 (rounded to the nearest cent)Therefore, the best choice is C.   Reference: CH01-Ref15Pedregon Corporation has provided the following information:

The incremental manufacturing cost that the company will incur if it increases production from 4,000 to 4,001 units is closest to:

A) $16.00
B) $14.05
C) $10.45
D) $13.45

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