Question

Based on a predicted level of production and sales of 21,000 units, a company anticipates total variable costs of $105,000, fixed costs of $25,200, and operating income of $147,000. Based on this information, the budgeted amount of fixed costs for 19,000 units would be:

Answer 1

Answer:

$25,200

Explanation:

Fixed costs remain constant at all levels within the relevant range

Answer 2

Answer:

The budgeted amount of fixed costs for 19,000 units is  $155,800

Explanation:

According to the Given Scenario the Following are Computation to find out the budgeted amount of fixed costs for 19,000 units.

$Current Contribution Margin = \frac{Fixed Cost + Operating Income}{No of Unit Sold}$

Current Contribution Margin =$25,200 + $147,000/21,000

Current Contribution Margin = $172,200/21,000

Current Contribution Margin = $8.2 per Unit

The Contribution Margin for 19,000 units = $8.2 × 19,000

The Contribution Margin for 19,000 units = $155,800

Therefore, The budgeted amount of fixed costs for 19,000 units is  $155,800