Figure 11-6. Kyle Company uses forklifts to move materials from the storage area to the production floor.There are five forklifts.They are fully used 20 hours per day (making 8 moves per hour).The company works 320 days per year,running two seven-hour shifts per day.Fork-lift operators work 1,800 hours per year and are paid an annual salary of $56,000.
Based on a recent study each forklift uses 0.45 gallons of fuel per move.The cost of fuel is $3.80 per gallon.
Refer to Figure 11-6.Suppose that the actual moves made are 80% of the forklifts' capacity.What is the after-the-fact budgeted fuel cost?
A)$448,000
B)$299,600
C)$492,000
D)$353,600
E)$350,208

Question

Quizplus · Accepted Answer

The forklifts' capacity is 8 moves per hour, 20 hours per day, 5 forklifts, and 320 days per year. Actual moves are 80% of this capacity. Calculate the total moves, then multiply by 0.45 gallons per move and $3.80 per gallon to find the fuel cost.