Perez Company Uses Activity-Based Costing

question 11

Multiple Choice

Perez Company uses activity-based costing.The company is trying to estimate the costs of the processing activity in the factory.The company has developed the following flexible budget formula:
Y = $10.50X + $13,000
Where: Y = Total processing cost per quarter and X = Number of machine hours
If 10,000 machine hours are used next quarter,total variable costs are ________ and total fixed costs are ________.

• A) $105,000; $13,000
• B) $105,000; $130,000,000
• C) $113,000; $130,000,000
• D) $10.50; $13,000

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