Fixed Costs Remain Constant at $200 000 Per Month

question 155

Multiple Choice

Fixed costs remain constant at $200 000 per month.During high-output months variable costs are $160 000,and during low-output months variable costs are $40 000.What are the respective high and low indirect-cost rates if budgeted professional labour-hours are 8000 for high-output months and 2000 for low-output months?

• A)$45.00 per hour;$120.00 per hour
• B)$25.00 per hour;$20.00 per hour
• C)$56.20 per hour;$120.00 per hour
• D)$45.00 per hour;$45.00 per hour

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