Johnson & Johnson analyzes manufacturing costs using the high-low method. In March 2036, the company incurs costs for producing 10,000 units.

• Low activity level: 5,000 units, cost $500,000
• High activity level: 10,000 units, cost $800,000

Required:

• Calculate the variable cost per unit and the fixed cost.
• Predict the cost to produce 15,000 units.