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4.Suppose a manufacturing company has a machine that can produce up to 1,000 units per month. The cost of operating this machine remains constant until

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4.Suppose a manufacturing company has a machine that can produce up to 1,000 units per month. The cost of operating this machine remains constant until the production level reaches 1,000 units. Once the production exceeds this threshold, the company needs to invest in additional machines, resulting in a step increase in the fixed cost. ABC Company has collected the following data for its monthly production levels and corresponding costs: Required: Using the equation method, separate the mixed costs into their fixed and variable components. Separate Mixed Costs (Continued...) Linear equation of mixed costs. Linear equation: Y=a+bX. Where: Ycboutput)X====TotalmixedcostTotalfixedcostVariablecostperunitofactivity(orLevelofactivity(oroutput) Calculation: 1) Variable rate: Variablerate=(HighestoutputLowestoutput)(HighestcostLowestcost)

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