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Cathy and Tom's Specialty Ice Cream Company operates a small production facility for the local community. The facility has the capacity to make 16,500 gallons of the single flavor, GUI Chewy, annually. The plant has only two customers, Chuck's Gas & Go and Marcee's Drive & Chew DriveThru. Annual orders for Chuck's total 8,500 gallons and annual orders for Marcee's total 4,600 gallons. Variable manufacturing costs are $1.20 per gallon, and annual fixed manufacturing costs are $29,400.

Required:

What cost per gallon should the cost system report? (Round your intermediate calculations and final answers to 2 decimal places. Omit the "$" sign in your response.)


Cost per gallon at capacity	$
Cost per gallon at demand	$

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M9959087

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