Question

Cardero Midwifery's cost formula for its wages and salaries is $2,280 per month plus $348 per birth. For the month of August, the company planned for activity of 118 births, but the actual level of activity was 116 births. The actual wages and salaries for the month was $44,120. The wages and salaries in the planning budget for August would be closest to:

Answer 1

Answer:

Total cost= $43,344

Explanation:

Giving the following information:

Cardero Midwifery's cost formula for its wages and salaries is $2,280 per month plus $348 per birth. For August, the company planned for an activity of 118 births.

To calculate the budgeted cost, we need to use the following formula:

Total cost= total fixed cost + unitary variable cost*number of units

Total cost= 2,280 + 348*118

Total cost= $43,344