Prowse Corporation is an oil well service company that measures its output by the number of wells serviced. The company has provided the following fixed and variable cost estimates that it uses for budgeting purposes.
Fixed Element Variable Element
per Month per Well Serviced
Revenue $ 4,000
Employee
salaries and wages $ 43,800 $ 1,000
Servicing materials $ 600
Other expenses $ 38,200
A total of 42 wells were actually serviced during October. The "Other expenses" in the flexible budget for October would have been closest to:
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