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Sunland's Recording Studio rents studio time to musicians in two-hour blocks. Each session includes the use of the studio facilities, a digital recording of
Sunland's Recording Studio rents studio time to musicians in two-hour blocks. Each session includes the use of the studio facilities, a digital recording of the performance, and a professional music producer/mixer. Anticipated annual volume is 1.200 sessions. The company has invested $2,163,840 in the studio and expects a return on investment of 25%. Budgeted costs for the coming year are as follows: Direct materials (tapes, CDs, etc.) Direct labour Variable overhead Per Session Total $20 395 45 Fixed overhead Variable selling and administrative expenses Fixed selling and administrative expenses (a) Determine the total cost per session. Total cost per session 00 40 $1,164,000 588,000
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