Use the information provided in Table 6 to calculate the cost to issue a life insurance policy, including receiving and processing applications for each product.

Table 6: Cost to Receive and Process Life Insurance Application - July 2012 Volumes for Cost Drivers Applications 11,489 New Life Policies 9,385 Function Variable Fixed Total Characteristics of Costs New Business - Life (Management): Manage new policy underwriting and issuance Salaries & Benefits 112,522 112,522 Fixed within range of +/- 20% of current levels Supplies 4,252 4,252 Fixed within range of +/- 20% of current levels Depreciation - Furniture 10,200 10,200 Fixed within range of +/- 20% of current levels Leased PCs 14,650 14,650 Fixed within range of +/- 20% of current levels Allocated Rent 15,250 15,250 Fixed within range of +/- 20% of current levels All Other 34,651 34,651 Fixed within range of +/- 20% of current levels Total $191,525 $191,525 New Applications: Receive and review new life policy applications Salaries & Benefits 225,125 252,500 477,625 Hourly, part time considered variable; others are within a range of +/- 20% of current levels Supplies 62,150 62,150 Vary with applications Depreciation - Furniture 32,500 32,500 Fixed within range of +/- 20% of current levels Leased PCs 52,500 52,500 Fixed within range of +/- 20% of current levels Allocated Rent 65,250 65,250 Fixed within range of +/- 20% of current levels All Other 125,226 125,226 Fixed within range of +/- 20% of current levels Total $287,275 $527,976 $815,251 Policy Underwriting: Review and underwrite new life policies Salaries & Benefits 375,125 512,500 887,625 Hourly, part time considered variable; others are within a range of +/- 20% of current levels Medical reports 215,047 215,047 Vary with applications Supplies 61,250 61,250 Vary with applications Depreciation - Furniture 51,500 51,500 Fixed within range of +/- 20% of current levels Leased PCs 62,500 62,500 Fixed within range of +/- 20% of current levels Allocated Rent 125,250 125,250 Fixed within range of +/- 20% of current levels All Other 207,653 207,653 Fixed within range of +/- 20% of current levels Total $651,422 $959,403 $1,610,825 Policy Issuance: Process and issue new life policies Postage & Mail Costs 37,540 37,540 Vary with applications Salaries & Benefits 412,525 125,862 538,387 Hourly, part time considered variable; others are within a range of +/- 20% of current levels Supplies 72,175 72,175 Vary with applications Depreciation - Furniture 56,750 56,750 Fixed within range of +/- 20% of current levels Leased PCs 82,500 82,500 Fixed within range of +/- 20% of current levels Allocated Rent 145,250 145,250 Fixed within range of +/- 20% of current levels All Other 260,362 260,362 Fixed within range of +/- 20% of current levels Total $522,240 $670,724 $1,192,964