Ricwy Corporation uses the cost formula Y = $4,800 + $0.40X for the maintenance cost, where X is machine-hours. The August budget is based on 9,000 hours of planned machine time. Maintenance cost expected to be incurred during August is:
A)$4,800
B)$3,600
C)$8,400
D)$1,200

Question

Quizplus · Accepted Answer

Plug in X = 9,000 into the cost formula:
Y = $4,800 + $0.40(9,000)
Y = $4,800 + $3,600
Y = $8,400

Therefore, the maintenance cost expected to be incurred during August is $8,400.

Ricwy Corporation Uses the Cost Formula Y = $4,800