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(Solved): Cairney, Incorporated manufactures a specialized part used in internal combustion engines. The annua ...



Cairney, Incorporated manufactures a specialized part used in internal combustion engines. The annual demand for the part is 227,000 units. The facility has a practical capacity of 242,000 units annually. The company leased the current facility because facilities capable of manufacturing the unit require machines that can produce 60,500 units each. The annual cost of the facility is $876,040. The variable cost of a part is $4. Required: What cost per unit should the cost system report to facilitate management decision making? Note: Round your answer to 2 decimal places. What is the cost of excess capacity? I have established that the Cost per unit is $7.86 and that is correct. I have also established that 54,300, 60,000, 117,888 57,888, and 57,900 are INCORRECT.



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