Question

Ballard Company incurred a total cost of $8,600 to produce 400 units of pulp. Each unit of pulp required five (5) direct labor hours to complete. What is the total fixed cost if the variable cost was $1.50 per direct labor hour

Answer 1

Answer:

$5,600

Explanation:

Total Cost = Fixed Cost + Variable Cost

therefore

Fixed Cost = Total Cost - Variable Cost

                   = $8,600 - (400 x 5 x $1.50)

                   = $5,600

thus

the total fixed cost if the variable cost was $1.50 per direct labor hour is $5,600