Question
Biblio Files Company is the chief competitor of Cover-to-Cover Company in the bookshelf business. Biblio Files is analyzing its manufacturing costs, and has compiled the
Biblio Files Company is the chief competitor of Cover-to-Cover Company in the bookshelf business. Biblio Files is analyzing its manufacturing costs, and has compiled the following data for the first six months of the year. After reviewing the data, answer questions (1) through (3) below.
Month Number of Units Produced Total Cost
January 4,360 $65,600
February 250 $6,250
March 1,000 $15,000
April 5,250 $56,250
May 1,750 $32,500
June 3,015 $48,000
1. From the data provided above, help Biblio Files Company estimate the fixed and variable portions of its total costs using the High-Low Method. Recall that Total Costs = (Variable Cost Per Unit x Units Produced) + Fixed Cost.
Total Fixed Cost = ?
Variable Cost per Unit Points = ?
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