Bixby Inc. expects total costs to be $75,000 when 500 units are sold and the variable cost is $18 per unit. Bixby expects to sell 750 units in July. What will be expected total costs in July?

Question

Quizplus · Accepted Answer

The total costs equation is: Total Costs = Fixed Costs + (Variable Cost per Unit x Number of Units). 
We know that the fixed cost is $75,000, variable cost per unit is $18, and the number of units sold in July is 750. 
Plugging in these values, we get:
Total Costs = $75,000 + ($18 x 750) = $79,500. 
Therefore, the expected total costs in July is $79,500.

Bixby Inc Expects Total Costs to Be $75,000 When 500 Units