Reference no: EM132660021

Briggs International manufactures aerial ladders for industrial use. Most of their costs are either true variable costs or fixed costs. However, an account analysis shows the following items are mixed costs.

Account                                  Analysis 2018                  Total Cost

Production supervision      75%                                   fixed $200,000
Utilities                                 25%                            fixed $ 80,000
Sales staff wages                  * 60%                            fixed $240,000
Quality control inspections**  90%                               fixed $ 60,000

• * The 40% variable portion relates to sales commissions based on total sales.
• ** 50% of manufactured units are inspected each year.
• In 2018 Briggs International produced and sold 1,000 ladders at $1,000 each. Management expects to sell 1,200 ladders in 2019, does not anticipate any cost increases due to inflation, and plans to maintain the selling price of $1,000 per ladder.

Problem 1: Given the above, what would be the estimated cost for 2019 for Sales staff wages?