Figure 3-4. Botana Company constructed the following formula for monthly utility cost.
Total utility cost = $1,200 + ($8.10 ´ labor hours)
Assume that 775 labor hours are budgeted for the month of April.
Refer to Figure 3-4.If Botana Company incurs 9,600 labor hours for the year,what would be the estimate of total utility cost?
A)$76,560
B)$78,960
C)$92,160
D)none of these are correct

Question

Quizplus · Accepted Answer

To estimate the total utility cost for the year, we need to plug in the total budgeted labor hours for the year (9,600) into the formula. Total utility cost = $1,200 + ($8.10 ´ 9,600) = $92,160. Therefore, option C is the correct answer.