Cena Inc. has decided to use the high-low method to estimate the total cost and the fixed and variable cost components of the total cost. The data for various levels of production are as follows: Units Produced Total Costs 80,000 $25,200,000 99,000 25,220,000 130,000 31,770,000 a. Determine the variable cost per unit and the total fixed cost. b. Based on part (A), estimate the total cost for 115,000 units of production.
Cena Inc. has decided to use the high-low method to estimate the total cost and the fixed and variable cost components of the total cost. The data for various levels of production are as follows: Units Produced Total Costs 80,000 $25,200,000 99,000 25,220,000 130,000 31,770,000 a. Determine the variable cost per unit and the total fixed cost. b. Based on part (A), estimate the total cost for 115,000 units of production.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Cena Inc. has decided to use the high-low method to estimate the total cost and the fixed and
variable cost components of the total cost. The data for various levels of production are as
follows:
Units Produced Total Costs
80,000 $25,200,000
99,000 25,220,000
130,000 31,770,000
a. Determine the variable cost per unit and the total fixed cost.
b. Based on part (A), estimate the total cost for 115,000 units of production.
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