Shipping expense is $9,000 for 8,000 kilograms shipped and $11,250 for 11,000 kilograms shipped.Assuming that this activity is within the relevant range,if the company ships 9,000 kilograms,its expected shipping expense would be closest to which of the following?
A) $8,583.
B) $9,750.
C) $9,972.
D) $10,125.

Question

Quizplus · Accepted Answer

To find the expected shipping expense for 9,000 kilograms, we first calculate the variable cost per kilogram based on the information provided. The difference in cost ($11,250 - $9,000 = $2,250) divided by the difference in kilograms shipped (11,000 - 8,000 = 3,000 kg) gives us a variable cost of $0.75 per kilogram. For 9,000 kilograms, the total cost would be the cost for 8,000 kilograms plus the variable cost for the additional 1,000 kilograms: $9,000 + ($0.75 * 1,000) = $9,750.

Shipping Expense Is $9,000 for 8,000 Kilograms Shipped and $11,250