Write a linear cost function equation for each of the following conditions. Use y for estimated costs and X for activity of the cost driver.
a.Direct materials cost is $2.70 per pound
b.Total cost is fixed at $800 per month regardless of the number of units produced.
c.Auto rental has a fixed fee of $90.00 per day plus $1.75 per mile driven.
d.Machine operating costs include $1,000 of maintenance per month, and $15.00 of coolant usage costs for each day the machinery is in operation.

Question

Quizplus · Accepted Answer

The Answer of Write a linear cost function equation for each of the following conditions. Use y for estimated costs and X for activity of the cost driver.
a.Direct materials cost is $2.70 per pound
b.Total cost is fixed at $800 per month regardless of the number of units produced.
c.Auto rental has a fixed fee of $90.00 per day plus $1.75 per mile driven.
d.Machine operating costs include $1,000 of maintenance per month, and $15.00 of coolant usage costs for each day the machinery is in operation.

Write a Linear Cost Function Equation for Each of the Following