Round Company Currently Produces Cardboard Boxes in an Automated Process

Multiple Choice

Round Company currently produces cardboard boxes in an automated process.Expected production per month is 40,000 units.The required direct materials cost $0.30 per unit.Manufacturing fixed overhead costs are $24,000 per month.The cost driver for manufacturing fixed overhead costs is units of production.In a flexible budget at 20,000 units,the total fixed cost is ________ per month and the total variable cost is ________ per month.

A) $24,000; $6,000
B) $24,000; $12,000
C) $12,000; $6,000
D) $12,000; $12,000