Answer: C) $971,919
Step-by-step explanation:
7000 units generates: $590,730 variable + $372,750 fixed
Fixed cost does not change according to the number of units, it's independent, this way it will be the same for 7100 units
The variable cost will change. First, let's find out the cost per unit:
590,730/7000 = 84.39 per unit
For 7100 = 84.39*7100 = 599169
This way, the total cost for 7100 units is
372,750 + 599,169 = 971,919
