Question

Scott Equipment produces​ high-quality soccer balls. If the fixed cost per ball is $ 3 when the company produces 15 comma 000 ​balls, what is the fixed cost per ball when it produces 22 comma 500 ​balls? Assume that both volumes are in the same relevant range.

Answer 1

Answer:

$2 per ball

Explanation:

The computation of the fixed cost per ball is shown below:

Fixed cost per ball = Total fixed cost ÷ number of balls produced

where,

Total fixed cost = 15,000 balls × $3 = $45,000

And, the number of balls produced = 22,500 balls

So, the fixed cost per ball is

= $45,000 ÷ 22,500 balls

= $2 per ball

Hence, the fixed cost per ball is $2 per ball