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London Inc. has identified the following costs at different activity levels for electricity for their manufacturing plant: Units Produced Electricity Cost $50,000 1,000 2,000

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London Inc. has identified the following costs at different activity levels for electricity for their manufacturing plant: Units Produced Electricity Cost $50,000 1,000 2,000 3,000 4,000 5,000 $97,400 $148,000 $192,500 $242,000 Management is uncertain on how to predict costs at different activity levels and thus has asked for some assistance. Can electricity be classified as variable, fixed, or mixed? Use computations to support your answer.

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