The following information is available for a company's maintenance cost over the last seven months. Maintenance Cost Month Units Produced June July 90 180 120 150 210 August September October November December 240 60 $ 3,710 5,240 4,220 4,730 5,750 6,260 3,200 Using the high-low method, estimate both the fixed and variable components of its maintenance cost. High-Low method - Calculation of variable cost per unit produced Cost at high point minus cost at low point Change in cost Change in volume Volume at high point minus volume at low point Total cost at the high point Variable costs at the high point: Volume at the high point: Variable cost per unit produced Total variable costs at the high point Total fixed costs Total cost at the low point Variable costs at the low point: Volume at the low point: Variable cost per unit produced Total variable costs at the low point Total fixed costs 0
The following information is available for a company's maintenance cost over the last seven months. Maintenance Cost Month Units Produced June July 90 180 120 150 210 August September October November December 240 60 $ 3,710 5,240 4,220 4,730 5,750 6,260 3,200 Using the high-low method, estimate both the fixed and variable components of its maintenance cost. High-Low method - Calculation of variable cost per unit produced Cost at high point minus cost at low point Change in cost Change in volume Volume at high point minus volume at low point Total cost at the high point Variable costs at the high point: Volume at the high point: Variable cost per unit produced Total variable costs at the high point Total fixed costs Total cost at the low point Variable costs at the low point: Volume at the low point: Variable cost per unit produced Total variable costs at the low point Total fixed costs 0
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:The following information is available for a company's maintenance cost over the last seven months.
Maintenance Cost
Month
Units Produced
June
July
90
180
120
150
210
August
September
October
November
December
240
60
$ 3,710
5,240
4,220
4,730
5,750
6,260
3,200
Using the high-low method, estimate both the fixed and variable components of its maintenance cost.
High-Low method - Calculation of variable cost per unit produced
Cost at high point minus cost at low point
Change in cost
Change in volume
Volume at high point minus volume at low point
Total cost at the high point
Variable costs at the high point:
Volume at the high point:
Variable cost per unit produced
Total variable costs at the high point
Total fixed costs
Total cost at the low point
Variable costs at the low point:
Volume at the low point:
Variable cost per unit produced
Total variable costs at the low point
Total fixed costs
0
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