Using High-Low to Calculate Predicted Total Variable Cost and Total Cost for a Time Period that Differs from the Data Period

Pizza Vesuvio makes specialty pizzas. Data for the past 8 months were collected:

	Month	Labor Cost			Employee Hours
	January		$7,300			420
	February		10,199			610
	March		8,440			720
	April		10,087			670
	May		8,790			540
	June		7,831			410
	July		9,790			630
	August		7,750			370

Assume that this information was used to construct the following formula for monthly labor cost.

Total Labor Cost = $7,021 + ($1.97 X Employee Hours)

Required:

Assume that 4,000 employee hours are budgeted for the coming year. Use the total labor cost formula to make the following calculations:

1. Calculate total variable labor cost for the coming year. Round your answer to the nearest dollar. $fill in the blank 1

2. Calculate total fixed labor cost for the coming year. Round your answer to the nearest dollar. $fill in the blank 2

3. Calculate total labor cost for the coming year. Round your answer to the nearest dollar.