John Stern operates a retail store. The business is studying order processing costs behaviour and has gathered the following data for a recent seven-month period. Sales Order Order Processing Costs $40,000 Month June 3,000 July August September October $28,000 $65,000 $39,000 $32,000 $20,000 $30,000 1,500 4,000 2,800 November December 2,300 1,000 2,000 (i) Determine the variable cost per sales order and the fixed cost using the high-low method. (ii) What is the equation of the total mixed cost function? (iii) Prepare the scatter gram, clearly showing any outliers.

John Stern operates a retail store. The business is studying order processing costs behaviour and has gathered the following data for a recent seven-month period. Sales Order Order Processing Costs $40,000 Month June 3,000 July August September October $28,000 $65,000 $39,000 $32,000 $20,000 $30,000 1,500 4,000 2,800 November December 2,300 1,000 2,000 (i) Determine the variable cost per sales order and the fixed cost using the high-low method. (ii) What is the equation of the total mixed cost function? (iii) Prepare the scatter gram, clearly showing any outliers.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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MN.45.
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