the smith company made and sold 10,000 metal tables last year. when output was between 5,000 and 10,000 tables, its average variable cost was $24. in this output range, each table contributed 60 percent of its revenue to fixed costs and profit. what was the price per table?
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To find the price per table, we need to calculate the fixed cost and profit per table. Here's how you can do it step by step:
Step 1: Calculate the average variable cost per table:
Given that the average variable cost is $24, we can assume that the variable cost per table is $24 for outputs between 5,000 and 10,000 tables.
Step 2: Calculate the total variable cost:
To find the total variable cost, we multiply the variable cost per table by the number of tables produced:
Total Variable Cost = Average Variable Cost per Table × Number of Tables
Since the number of tables produced is not specified, we cannot calculate the total variable cost accurately.
Step 3: Calculate the contribution per table to fixed costs and profit:
We are told that each table contributes 60 percent of its revenue to fixed costs and profit. To calculate the contribution per table, we multiply the price per table by 60%.
Step 4: Calculate the fixed costs and profit per table:
To find the fixed cost and profit per table, we subtract the contribution per table from the price per table.
Unfortunately, we do not have enough information to proceed with the calculation as the fixed costs and the number of tables produced are not specified. Without these details, we cannot determine the price per table.