Question

PE Company wants to estimate total costs (overhead plus administrative) in March, when production is expected to be 1,450 units. It analyzed January costs to determine the parameters of the overhead and administrative cost functions January production was 1,000 units and costs were as follows: Total overhead costs S67.000 Total fixed overhead costs 34.170 Total administrative costs 35.000 Total variable administrative costs 7,350 What is X Company's estimate of total costs in March (round unit costs to two decimal places)? 5. AO $38,377 BO $51,041 CO $67,885 DO 890,286 EO $120.081 FO $159,708

Answer 1

Answer: Option (E) $120,081

		Variable	Units	Per Unit
Total overhead costs	$67000	32830	1000	32.83
Total fixed overhead costs	34170
Total administrative costs	35000
Total variable administrative costs	7350	7350	1000	7.35
Administrative Fixed costs	27650

Total Estimated Cost of X For March
	Units	Cost	Total
Overhead costs
Variable overhead costs	1450	47603.5
Fixed overhead costs		34170
Total fixed overhead costs			81773.5
Variable administrative cost	1450	10657.5
Fixed administrative cost		27650
Total administrative cost			38307.5
Total Estimated cost for march			120081