Question

Exercise 11-9 Mixed cost at different levels of activity LO 11-1

Zachary Corporation paid one of its sales representatives $8,000 during the month of March. The rep is paid a base salary plus $13 per unit of product sold. During March, the rep sold 100 units.

Required

Calculate the total monthly cost of the sales representative’s salary for each of the following months:

Month	April	May	June	July
Number of units sold	140	50	150	60
Total variable cost
Total fixed cost
Total salary cost

Answer 1

Month	April	May	June	July
Number of units sold	140	50	150	60
Total variable cost	1820	650	1950	780
Total fixed cost	6700	6700	6700	6700
Total salary cost	8520	7350	8650	7480
Workings:
Base salary	6700	=8000-(100*13)
	April	May	June	July
Total variable cost	=140*13	=50*13	=150*13	=60*13