Inspection costs at one of Lisa Corporation's factories are listed below: Units Produced Inspection Cost February 905 $16,212 March 949 $16,600 April 911 $16,265 May 895 $16,110 June 917 $16,294 July 902 $16,180 August 919 $16,332 September 859 $15,760 October 898 $16,138 Management believes that inspection cost is a mixed cost that depends on units produced. Show all calculations: A) Using the high-low method, calculate the estimate of the variable component of inspection cost per unit produced B) Using the high-low method, calculate the estimate of the fixed component of inspection cost per month C)State the formula in the form Y = a + bX D) Using the high-low method, calculate the estimate of the total inspection cost if projected units produced for November are 980.
6. . Inspection costs at one of Lisa Corporation's factories are listed below:
|
|
|
Units Produced |
Inspection Cost |
|
|
February |
905 |
$16,212 |
|
|
March |
949 |
$16,600 |
|
|
April |
911 |
$16,265 |
|
|
May |
895 |
$16,110 |
|
|
June |
917 |
$16,294 |
|
|
July |
902 |
$16,180 |
|
|
August |
919 |
$16,332 |
|
|
September |
859 |
$15,760 |
|
|
October |
898 |
$16,138 |
Management believes that inspection cost is a mixed cost that depends on units produced.
Show all calculations:
A) Using the high-low method, calculate the estimate of the variable component of inspection cost per unit produced
B) Using the high-low method, calculate the estimate of the fixed component of inspection cost per month
C)State the formula in the form Y = a + bX
D) Using the high-low method, calculate the estimate of the total inspection cost if projected units produced for November are 980.
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