Question

Based on a predicted level of production and sales of 30,000 units, a company anticipates total variable costs of $120,000, fixed costs of $42,000, and operating income of $36,000. Based on this information, the budgeted amount of variable costs for 27,000 units would be: $120,000. $108,000. $78,000. $42,000. $129,000.

Answer 1

The correct answer is B.

Step-by-step explanation:

Giving the following information:

Based on a predicted level of production and sales of 30,000 units, a company anticipates total variable costs of $120,000, fixed costs of $42,000, and operating income of $36,000. Based on this information, the budgeted amount of variable costs for 27,000 units would be:

Unitary variable cost= 120,000/30,000= $4

Variable cost= 4*27,000= $108,000