Question

Steeplechase Building Specialties manufactures metal stud to accommodate commercial framing contractors in the United States. The managerial accountant reported to the operations manager that there is an order to manufacture

2,300

bundles of metal stud during the month. The managerial accountant reported the following? information:

Variable	Coefficient
Constant	$$170
Independent variable	$260

Determine the cost equation for the managerial accountant and predict the operating costs at a volume of

2,300

bundles of metal stud at Steeplechase Building Specialties.

Answer 1

Solution:
	Operating costs at a volume of 2,300	$598,170
Working Notes:
	The cost equation for the managerial accountant
	Y = Constant + (Volume x Independent variable)
	Where Y = operating costs
	Y = Constant + (Volume x Independent variable)
	Y= $170 + (2300 x 260)
	Y= $170 + $598,000
	Y= $598,170
	Operating costs at a volume of 2,300	$598,170
Please feel free to ask if anything about above solution in comment section of the question.