PROBLEM: Front Range Furniture expects to maintain the sameinventories at the end of 2020 as at the beginning of the year. Thetotal of all production costs for the year is assumed to be equalto the cost of goods sold. With this in mind, the variousdepartment heads were asked to submit estimates of the costs oftheir departments during the year. A summary report of theseestimates is as follows:

                                                                       Estimated variablecost                  Estimated Fixed cost

Productioncosts:                          

Direct material                                                      50    

Directlabor                                                            30    

Factoryoverhead                                                                                                        350,000

Selling Expense:

Sales salaries/ commission                                    4                                                          340,000

Travel                                                                                                                                          4,000

Advertising                                                                                                                             116,000

Miscellaneous Sellingexpenses                            1                                                              2,300

Administrative Expenses:

Management and office staffsalaries                                                                               325,000

Officesupplies                                                         4                                                                6,000

Misc. Administrativeexpenses                             1                                                                8,700

                                                                               ----------                                                    --------------

                                                                                   $90                                                       $1,152,000

It’s expected that 12,000 units will be sold at a price of $240per unit. Maximum sales within the relevant range are 18,000.

Required: Complete the chart in your working papers to calculatetotal fixed and variable costs (see the Working Papers for moredetailed instructions).