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basic concepts the following data apply to the provision of psychological testing se 690858

Basic Concepts

The following data apply to the provision of psychological testing services.

Sales price per unit (1 unit _ 1 test plus feedback to client)

$ 300

Fixed costs (per month):


Selling and administration


Production overhead (e.g., rent of testing facilities)


Variable costs (per test):


Labor for oversight and feedback


Outsourced test analysis


Materials used in testing


Production overhead


Selling and administration (e.g., scheduling and billing)


Number of tests per month

1,000 tests


Give the amount for each of the following (one unit _ one test):

a. Variable production cost per unit.

b. Variable cost per unit.

c. Full cost per unit.

d. Full absorption cost per unit.

e. Prime cost per unit.

f. Conversion cost per unit.

g. Contribution margin per unit.

h. Gross margin per unit.

i. Suppose the number of units decreases to 800 tests per month, which is within the relevant range. Which parts of (a) through ( h ) will change? For each amount that will change, give the  new amount for a volume of 800 tests.

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