ABC Metal Company makes designer emblems for luxury vehicles. Each emblem is handcrafted out of titanium to the customers design specifications. ABC artisans are paid an hourly wage and work between 30 and 60 hours a week. ABC uses the straight-line method of depreciation. To ensure that each emblem conforms to the customers specifications, ABC has each emblem inspected by an independent company. The inspection company charges a set price per month, plus an additional amount for each item inspected. After inspection, each emblem is shipped in a crush-resistant shipping container.

A) Which of ABC costs (titanium, artisan wages, equipment depreciation, inspection, shipping containers) is a mixed cost? Explain.

B) Data on total mixed costs and total production for ABC five months of operations are as follows: (See handout)

1) Find Variable Cost per Unit. Formula: Variable Cost per Unit = Difference in Total Cost / Difference in Units Produced

B) Data on total mixed costs and total production for ABC five months of operations are as follows: Units produced Total cost August 1,000 units $ 80,000 September 1,200 units $ 86,000 October 1,600 $ 98,000 November 2,500 $125,000 December 2,200 $116,000 Using the high-low method, determine the (1) variable cost per unit and (2) total fixed costs. Units Produced Total Cost $125,000 Highest level Lowest level 1,500 Difference 1. Find Variable Cost per Unit. Formula: Variable Cost per Unit = Difference in Total Cost / Difference in Units Produced (1 points)