Using HighLow to Calculate Predicted Total Variable Cost and

Using High-Low to Calculate Predicted Total Variable Cost and Total Cost for Budgeted Output Pizza Vesuvio makes specialty pizzas. Data for the past 8 months were collected Month Labor Cost Employee Hours anuary7,300 410 February $10,199 600 March48,440 Ap 410,08 18, 790 7,031 19, 790 6,750 800 av June 100 030 360 july August Assume that this information was vsed to construct the fottowing formuls for menthly lak Total Labor Cost 47019 (62.03 Employes Hours) Required: t Assume that 675 employee hours are budgeted for the month of September Use tihe total labor cost formutia for the following calculations 1. Calculate total variable labor cost for September, Round your answer to nearest whole number 2. Calculate total labor cost for September. Round your answer to nearest whole number Prevíous Next Check My Work 3 more Check My Work uses remaining Suhmit Assiqnment for Gra

Solution

Q1 1 Total Variable cost $                              1,370 (675 x $2.03) 2 Total labor Cost $                              8,389 ($7019 + 1370.25) Q2 1 Overhead Cost Mixed Cost $253,000 Fixed Monthly cost $82 Variable cost per unit Direct labor hours No of units 2 Monthly overhead cost $                      1,073,000 ($253000 + $82 x 10000) 3 Quarterly overhead cost $                      4,039,000 ($253000 x 3 + $82 x 40000) 4 Annual overhead cost $                   16,156,000 ($253000 x 12 +$82 x 160000)