Chelsa Manufacturing Co

Chelsa Manufacturing Co.'s static budget at 5,000 units of production includes $40,000 for direct labor and $5,000 for variable electric power. Total fixed costs are $23,000. At 8,000 units of production, a flexible budget would show

A) variable costs of $64,000 and $28,000 of fixed costs
B) variable costs of $64,000 and $23,000 of fixed costs
C) variable costs of $72,000 and $23,000 of fixed costs
D) variable and fixed costs totaling $107,000

Correct Answer:

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