The Blaine Corporation Is a Highly Automated Manufacturer

Multiple Choice

The Blaine Corporation is a highly automated manufacturer. At an activity level of 6,000 machine setups, total overhead costs equal $240,000. Of this amount, depreciation totals $80,000 (all fixed) and lubrication totals $72,000 (all variable) . The remaining $88,000 of the total overhead cost consists of utility cost (mixed) . At an activity level of 9,000 setups, utility cost totals $112,000.Assume that the relevant range includes all of the activity levels mentioned in this problem.If 7,800 setups are projected for the next period, total expected overhead cost would be closest to:

A) $156,000
B) $236,000
C) $214,400
D) $276,000