A Project Has Estimated Sales of 2,600 Units at $15

Multiple Choice

A project has estimated sales of 2,600 units at $15.40 per unit; variable costs per unit of $6.79,± 3 percent; annual fixed costs of $17,500,± 3 percent; and depreciation of $2,850 per year.The company bases its sensitivity analysis on the expected scenario.If a sensitivity analysis is conducted using a variable cost of $7,what will be the total annual variable costs?

A) $18,746
B) $18,200
C) $16,625
D) $17,654
E) $21,185