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Computing the total budgeted cost

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Fields Corporation has a high probability of operating at 46,000 activity hours during the upcoming period, and lower probabilities of operating at 36,000 hours and 56,000 hours. The company's flexible budget revealed the following:

36,000 Hours 46,000 Hours 56,000 Hours

Variable costs $270,000 $345,000 $420,000

Fixed costs $960,000 $960,000 $960,000

If Fields operated at 41,000 activity hours, its total budgeted cost would be:

  • 1,380,000
  • 1,444,500
  • 1,825,500
  • 1,062,000
  • 1,267,500

Reference no: EM132431323

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