Mechanics Insurance Company {P'MlC}. Betore the establishment ot the in-house printing depart ment, the departments contracted with external printers tor their printing work. FMIC's printing policy is to charge departments for the variable printing costs on the basis of number of pages printed. The company recovers xed costs in pricing of external jobs. The rst year's budget for the printing department was based on the department's expected total costs divided by the planned number of pages to be printed. Most external government accounts and all internal jobs were expected to use only singlecolor printing. External commercial accounts use primarily fourcolor printing. FMIC estimated its variable costs based on the typical mix of single-color versus four-color printing and the average variable cost of printing a fourcolor page that is one-torutb graphics and threefourths text. The expected annual costs for each division were as follows: Planned Pages Estimated Cost Department Printed Budgeted Charges per Page Government accounts 12041141] $ 9D,D Commercial accounts 250.1301} BURDEN] Internal departments saloon EDIDDEI Total 42am It} $42i},{m $