Frankfurters sells steamed hot dogs for $2.50 each. The company provided the following units and total cost data concerning its hot dog sales for the last six months of 2018: Units Cost March 2,400 $3,020 April 2,530 $3,125 May 2,300 $3,040 June 2,250 $2,700 July 2,160 $2,730 August 2,030 $2,680 a. Using the high-low method, what is the variable cost per unit? b. Using the high-low method, what is the fixed cost per month?

Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Don R. Hansen, Maryanne M. Mowen
Chapter20: Inventory Management: Economic Order Quantity, Jit, And The Theory Of Constraints
Section: Chapter Questions
Problem 2CE: Sterling Corporation has an EOQ of 5,000 units. The company uses an average of 500 units per day. An...
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Frankfurters sells steamed hot dogs for $2.50 each. The
company provided the following units and total cost data
concerning its hot dog sales for the last six months of 2018:
Units
Cost
March
2,400
$3,020
April
2,530
$3,125
May
2,300
$3,040
June
2,250
$2,700
July
2,160
$2,730
August
2,030
$2,680
a. Using the high-low method, what is the variable cost
per unit?
b. Using the high-low method, what is the fixed cost per
month?
Transcribed Image Text:Frankfurters sells steamed hot dogs for $2.50 each. The company provided the following units and total cost data concerning its hot dog sales for the last six months of 2018: Units Cost March 2,400 $3,020 April 2,530 $3,125 May 2,300 $3,040 June 2,250 $2,700 July 2,160 $2,730 August 2,030 $2,680 a. Using the high-low method, what is the variable cost per unit? b. Using the high-low method, what is the fixed cost per month?
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