In a period when anticipated production is 5,000 units, budgeted variable costs are $75,000 and budgeted fixed costs are $24,000.If 5,600 units are actually produced, what is the expected total cost?
A)$110,600
B)$84,000
C)$108,000
D)$88,394

Question

Quizplus · Accepted Answer

First, we need to calculate the total budgeted cost per unit:

Total budgeted cost = budgeted variable cost + budgeted fixed cost 
Total budgeted cost = $75,000 + $24,000 
Total budgeted cost = $99,000

Budgeted cost per unit = Total budgeted cost / Anticipated production 
Budgeted cost per unit = $99,000 / 5,000 
Budgeted cost per unit = $19.80

To calculate the expected total cost when 5,600 units are actually produced:

Expected total cost = Budgeted cost per unit x Actual production 
Expected total cost = $19.80 x 5,600 
Expected total cost = $110,880

Therefore, the best choice is C.

In a Period When Anticipated Production Is 5,000 Units, Budgeted