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High-Low Method Ziegler 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
Ziegler 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 | |||
80,000 | $25,100,000 | |||
92,000 | 27,206,000 | |||
120,000 | 32,120,000 |
a. Determine the variable cost per unit and the total fixed cost.
Variable cost (Round to two decimal places.) | $fill in the blank 1 per unit |
Total fixed cost | $fill in the blank 2 |
b. Based on part (a), estimate the total cost for 115,000 units of production.
Total cost for 115,000 units | $fill in the blank 3 |
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