Question
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
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 | |||
| January | $7,100 | 340 | |||
| February | $9,999 | 530 | |||
| March | $8,240 | 610 | |||
| April | $9,887 | 590 | |||
| May | $8,590 | 460 | |||
| June | $7,631 | 330 | |||
| July | $9,590 | 550 | |||
| August | $7,550 | 290 | |||
Assume that this information was used to construct the following formula for monthly labor cost.
| Total Labor Cost = $6924 + ($2.16 x Employee Hours) |
Required:
Assume that 715 employee hours are budgeted for the month of September. Use the total labor cost formula for the following calculations:
1. Calculate total variable labor cost for September. Round your answer to nearest whole number. $fill in the blank 1
2. Calculate total labor cost for September. Round your answer to nearest whole number. $fill in the blank 2
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Accounting Accounting Made Simple For Beginners
Authors: Robert Briggs
1st Edition
1761032739, 978-1761032738
