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		$6,900		350
	February		$9,799		540
	March		$8,040		660
	April		$9,687		600
	May		$8,390		470
	June		$7,431		340
	July		$9,390		560
	August		$7,350		300

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

Total Labor Cost = $6774 + ($1.92 x Employee Hours)

Required:

Assume that 675 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. $