Young Corporation has a high probability of operating at 40,000 activity hours during the upcoming period, and lower probabilities of operating at 30,000 hours and 50,000 hours. The company's flexible budget revealed the following:

	30,000 Hours	40,000 Hours	50,000 Hours
Variable costs	$135,000	$180,000	$225,000
Fixed costs	700,000	700,000	700,000

rev: 10_29_2012

15.

Young's flexible-budget formula, where Y is defined as total cost and AH represents activity hours, is (Round calculations to 2 decimals.):

	Y = $4.50AH + $700,000.
	Y = $180,000 + $17.50AH.
	Y = $925,000.
	Y = $22.00AH.
	Y = $4.50AH + $23.30AH.