Questions: Chapter 1 Homework Problems Cost Classifications (Static) (The following information applies to the questions displayed below) Kubin Company's relevant range of production is 18,000 to 22,000 units. When it produces and sells 20,000 units, its average costs per unit are as follows: - Average cost per unit - Direct materials: 7.90 - Direct labor: 4.00 - Variable manufacturing overhead: 1.50 - Fixed manufacturing overhead: 5.32 - Fixed selling expense: 3.50 - Fixed administrative expense: 2.50 - Sales commissions: 1.00 - Variable administrative expense: 0.50 Exercise 1-10 (Static) Differential Costs and Sunk Costs [LO1-5] Required: What is the incremental manufacturing cost incurred if the company increases production from 20,000 to 20,001 units? Note: Round your answer to 2 decimal places.

Transcript text: Chapter 1 Homework Problems Cost Classifications (Static) (The following information applies to the questions displayed below) Kubin Company's relevant range of production is 18,000 to 22,000 units. When it produces and sells 20,000 units, its average costs per unit are as follows: \begin{tabular}{|c|c|} \hline & Average cost per unit \\ \hline Direct materials & \$7.90 \\ \hline Direct labor & \$4.00 \\ \hline Variable manufacturing overhead & \$1.50 \\ \hline Fixed manufacturing overhead & \$5.32 \\ \hline Fixed selling expense & \$3.50 \\ \hline Fixed administrative expense & \$2.50 \\ \hline Sales commissions & \$1.00 \\ \hline Variable administrative expense & \$0.50 \\ \hline \end{tabular} Exercise 1-10 (Static) Differential Costs and Sunk Costs [LO1-5] Required: What is the incremental manufacturing cost incurred if the company increases production from 20,000 to 20,001 units? Note: Round your answer to 2 decimal places.