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8 November, 19:24

Wofril Corporation uses the cost formula Y = $5,300 + $0.60X for the maintenance cost, where X is machine-hours. The August budget is based on 8,000 hours of planned machine time. Maintenance cost expected to be incurred during August is:A) $10,100

B) $4,800

C) $500

D) $5,300

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Answers (1)
  1. 8 November, 19:43
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    Option (A) is correct.

    Explanation:

    Given that,

    Formula for maintenance cost: Y = $5,300 + $0.60X

    X is machine-hours

    Planned machine time for August budget = 8,000 hours

    Therefore,

    Maintenance cost expected to be incurred during August:

    = $5,300 + $0.60X

    = $5,300 + ($0.60 * 8,000)

    = $5,300 + $4,800

    = $10,100

    Therefore, the maintenance cost is $10,100.
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