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Davies Company's Utility Cost at various levels of activity are shown below: Month Units Utility Cost April 70,000 $198,000 May 60,000 $174,000 June 80,000 $222,000
Davies Company's Utility Cost at various levels of activity are shown below:
Month Units Utility Cost
April 70,000 $198,000
May 60,000 $174,000
June 80,000 $222,000
July 90,000 $246,000
Requirement 1: Given the above information, use the High-Low method to compute the variable and fixed portion of utility cost. Show your computations and indicate the cost equation. (5 points)
Requirement 2: Using the equation from requirement 2, compute total cost estimate if 75,000 units are produced. Show your computations.
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