Lark Products, which uses the high-low method, had total costs of $30,000 at its lowest activity level when 6,000 units were sold. At its highest level of activity, sales equalled 15,000 units, and total costs were $50,000. Required: Estimate the fixed costs.

Principles of Accounting Volume 2
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Chapter2: Building Blocks Of Managerial Accounting
Section: Chapter Questions
Problem 5EB: Baxter Company has a relevant range of production between 15,000 and 30,000 units. The following...
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Lark Products, which uses the high-low method,
had total costs of $30,000 at its lowest activity
level when 6,000 units were sold. At its highest
level of activity, sales equalled 15,000 units, and
total costs were $50,000. Required: Estimate the
fixed costs.
Transcribed Image Text:Lark Products, which uses the high-low method, had total costs of $30,000 at its lowest activity level when 6,000 units were sold. At its highest level of activity, sales equalled 15,000 units, and total costs were $50,000. Required: Estimate the fixed costs.
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