Picozzi Snow Removal's cost formula for its vehicle operating cost is $2,060 per month plus $306 per snow-day. For the month of January, the company planned for activity of 16 snow-days, but the actual level of activity was 18 snow-days. The actual vehicle operating cost for the month was $7,720. The vehicle operating cost in the planning budget for January would be closest to:
A) $6,956
B) $6,862
C) $7,720
D) $7,568

Question

Quizplus · Accepted Answer

The planning budget cost is calculated as $2,060 + ($306 * 16) = $6,956.

Picozzi Snow Removal's Cost Formula for Its Vehicle Operating Cost