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1-15 Martinez Companys relevant range of production is 7,500 units to 12,500 units....

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Accounting

1-15

Martinez Companys relevant range of production is 7,500 units to 12,500 units. When it produces and sells 10,000 units, its average costs per unit are as follows:

Average Cost per Unit
Direct materials $ 5.20
Direct labor $ 2.70
Variable manufacturing overhead $ 1.50
Fixed manufacturing overhead $ 4.00
Fixed selling expense $ 2.20
Fixed administrative expense $ 2.00
Sales commissions $ 1.00
Variable administrative expense $ 0.50

What incremental manufacturing cost will Martinez incur if it increases production from 10,000 to 10,001 units? (Round your answer to 2 decimal places.)

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