Reference no: EM132521578

Using High-Low to Calculate Predicted Total Variable Cost and Total Cost for a Time Period that Differs from the Data Period Pizza Vesuvio makes specialty pizzas. Data for the past 8 months were collected:

Month                     Labor Cost                        Employee Hour

January                  $6,900                        340

February                  9,799                        530

March                        8,040                       620

April                       9,687                            590

May                          8,390                          460

June                           7,431                          330

July                             9,390                         550

August                            7,350                     290

Assume that this information was used to construct the following formula for monthly labor cost.

Total Labor Cost = $6,744 + ($2.09 X Employee Hours)

Required:

Assume that 4,200 employee hours are budgeted for the coming year. Use the total labor cost formula to make the following calculations:

Question 1. Calculate total variable labor cost for the coming year. Round your answer to the nearest dollar.

Question 2. Calculate total fixed labor cost for the coming year. Round your answer to the nearest dollar.

Question 3. Calculate total labor cost for the coming year. Round your answer to the nearest dollar.