Question
High-low method Evander Inc. has decided to use the high-low method to estimate the total cost and the fixed and variable cost components of the
High-low method
Evander Inc. has decided to use the high-low method to estimate the total cost and the fixed and variable cost components of the total cost. The data for various levels of production are as follows:
| Units Produced | Total Costs |
|---|---|
| 1,250 | $220,500 |
| 2,450 | 247,940 |
| 3,750 | 343,000 |
a. Determine the variable cost per unit and the total fixed cost. Variable cost $? Total fixed cost $?
b. Based on part (a), estimate the total cost for 1,800 units of production. Total cost for 1,800 units $?
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Financial and Managerial Accounting
Authors: Jonathan E. Duchac, James M. Reeve, Carl S. Warren
11th Edition
9780538480901, 9781111525774, 538480890, 538480904, 1111525773, 978-0538480895
