Question
Nikolas Boat Company makes inexpensive aluminum fishing boats. Production is seasonal, with considerable activity occurring in the spring and summer. Sales and production tend to
Nikolas Boat Company makes inexpensive aluminum fishing boats. Production is seasonal, with considerable activity occurring in the spring and summer. Sales and production tend to decline in the fall and winter months. During 2014, the high point in activity occurred in June when it produced 209 boats at a total cost of $160,520. The low point in production occurred in January when it produced 37 boats at a total cost of $47,000. Required: a. Use the high-low method to estimate the amount of fixed cost incurred each month by Nikolas Boat Company. b. Determine the total estimated cost if 160 boats are made.
Nikolas Boat Company makes inexpensive aluminum fishing boats. Production is seasonal, with considerable activity occurring in the spring and summer. Sales and production tend to decline in the fall and winter months. During 2014, the high point in activity occurred in June when it produced 209 boats at a total cost of $160,520. The low point in production occurred in January when it produced 37 boats at a total cost of $47,000 Required a. Use the high-low method to estimate the amount of fixed cost incurred each month by Nikolas Boat Comparn Fixed cost b. Determine the total estimated cost if 160 boats are made Total estimated costStep by Step Solution
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