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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: Labor Cost Employee Hours Month January $6,800 February $9,699 March $7,940 $9,587 $8,290 $7,331 $9,290 $7,250 April May June 340 530 640 590 460 330 July August Assume that this information was used to construct the following formula for monthly labor cost. Total Labor Cost = $6679 + ($1.97 x Employee Hours) 550 290 Required: Assume that 655 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. 2. Calculate total labor cost for September. Round your answer to nearest whole number.
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