High–low method—missing amounts The following data have been extracted from the records of Puzzle, Inc.: February AugustProduction level, in units. . . . . . . . . . . . . . . . . . 12,000 18,000Variable costs. . . . . . . . . . . . . . . . . . . . . . . . . . $21,000 $ ?Fixed costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . ? 31,000Mixed costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18,000 ?Total costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $70,000 $88,000Required:a. Calculate the missing costs.b. Calculate the cost formula for mixed cost using the high–low method.c. Calculate the total cost that would be incurred for the production of 20,000 units.d. Identify the two key cost behavior assumptions made in the calculation of your answer to part c
High–low method—missing amounts The following data have been extracted from the records of Puzzle, Inc.: February August
Production level, in units. . . . . . . . . . . . . . . . . . 12,000 18,000
Variable costs. . . . . . . . . . . . . . . . . . . . . . . . . . $21,000 $ ?
Fixed costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . ? 31,000
Mixed costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18,000 ?
Total costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $70,000 $88,000
Required:
a. Calculate the missing costs.
b. Calculate the cost formula for mixed cost using the high–low method.
c. Calculate the total cost that would be incurred for the production of 20,000 units.
d. Identify the two key cost behavior assumptions made in the calculation of your answer to part c
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