Sebastian Muffler, Inc. operates an automobile service facility. The table below shows the cost incurred during a month when 500 mufflers were replaced.Number of Muffler Replacements?400500600Total costs:??? Fixed costsA$9,000C Variable costsB6,000DTotal costsE$15,000F????Cost per muffler replacement:??? Fixed costGHI Variable costJKLTotal cost per muffler replacementMNORequired:Fill in the missing amounts, labeled A through O, in the table above.
What will be an ideal response?
| ? | Number of Muffler Replacements | ||
| ? | 400 | 500 | 600 |
| Total costs: | ? | ? | ? |
| Fixed costs | $9,000 | $9,000 | $9,000 |
| Variable costs | 4,800 | 6,000 | 7,200 |
| Total costs | $13,800 | $15,000 | $16,200 |
| ? | ? | ? | ? |
| Cost per muffler replacement: | ? | ? | ? |
| Fixed cost | $22.50 | $18.00 | $15.00 |
| Variable cost | 12.00 | 12.00 | 12.00 |
| Total cost per muffler replacement | $34.50 | $30.00 | $27.00 |
Explanatory notes:
A and C each equal $9,000, since fixed costs do not vary with activity.
J, K, and L each equal $12 ($6,000 500), since variable cost per replacement remains constant.
B equals $4,800 (400 $12)
D equals $7,200 (600 $12)
G equals $22.50 ($9,000 400)
H equals $18.00 ($9,000 500)
I equals $15.00 ($9,000 600)
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