Your Company Is Reviewing a Project with Estimated Labor Costs

Multiple Choice

Your company is reviewing a project with estimated labor costs of $14.68 per unit, estimated raw material costs of $43.18 a unit, and estimated fixed costs of $18,000 a month. Sales are projected at 15,500 units, ±5 percent, over the one-year life of the project. Cost estimates are accurate within a range of ±3 percent. What are the total variable costs for the best-case scenario?

A) $869,925
B) $861,560
C) $913,421
D) $951,960
E) $891,960