A graph of a flexible budget formula reflects fixed costs of $30,000 and total c
ID: 2530073 • Letter: A
Question
A graph of a flexible budget formula reflects fixed costs of $30,000 and total costs of $90,000 at a volume of 6,000 units. Assuming the relevant range is 1,000 to 12,000 units, the graph would reflect total costs at 10,000 units at what dollar amount? A graph of a flexible budget formula reflects fixed costs of $30,000 and total costs of $90,000 at a volume of 6,000 units. Assuming the relevant range is 1,000 to 12,000 units, the graph would reflect total costs at 10,000 units at what dollar amount?Explanation / Answer
Variable cost per unit = (90000-30000)/6000
=$10 per unit
Fixed cost = 90000 - 10(6000)
= $30000
Total Cost = Total Variable Cost + Total Fixed cost
= ( 10 per unit x 10,000) + 30,000
=$130,000