Answered step by step
Verified Expert Solution
Question
1 Approved Answer
You have taken over a the maintenance department in an existing business and you are asked to determine how much you should budget for the
You have taken over a the maintenance department in an existing business and you are asked to determine how much you should budget for the 2021 budget year if you are expected to process 475,000 work orders. Your only reference is historical financial data for the past 12 months as follows.
Months | Workorders | Total Costs |
January | 330,000 | $ 167,000 |
February | 165,000 | 110,000 |
March | 280,000 | 225,000 |
April | 225,000 | 105,000 |
May | 325,000 | 230,000 |
June | 210,000 | 120,000 |
July | 335,000 | 220,000 |
August | 285,000 | 160,000 |
September | 87,000 | 68,000 |
October | 162,000 | 147,000 |
November | 105,000 | 105,000 |
December | 115,000 | 87,000 |
Total Units | 2,624,000 | $ 1,744,000 |
1) Determine the variable cost per unit
2) Determine the total Fixed costs
3. How much should you budget for 2021 if it is expected that you will process 475,000 work orders.
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started