X Companys accountant analyzed the following overhead costs

X Company\'s accountant analyzed the following overhead costs in March to develop a cost function that could be used to predict overhead costs in future months. The accountant classified these costs as follows: supplies were variable; insurance was fixed; variable utilities were $15,555; fixed maintenance was $2,910. March production was 800 units; June production is expected to be 1,000 units. What are estimated total variable costs in June (round variable costs per unit to two decimal places)?

Solution

Total Cost for Production will be : $15,555+$2,910 = $18465

Estimated Total Variable costs in June will be $15.55