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Please answer parts B and C of question Cost Behavior Analysis in a Restaurant: High-Low Cost Estimation Assume a Papa John's restaurant has the following
Please answer parts B and C of question
Cost Behavior Analysis in a Restaurant: High-Low Cost Estimation Assume a Papa John's restaurant has the following information available regarding costs at representative levels of monthly sales: Monthly sales in units 5,000 8,000 10,000 Cost of food sold $10,000 $16,000 $20,000 Wages and fringe benefits 4,200 4,320 4,400 Fees paid delivery help 1,100 1.760 2.200 Rent on building 1,100 1.100 1.100 Depreciation on equipment 900 900 900 Utilities 800 920 1,000 Supplies (soap, floor wax, etc.) 250 340 Administrative costs 1,700 1,700 1,700 $20,050 $27,040 531,700 400 Total OX (b) Use the high-low method to develop a schedule Identitying the amount of each cost that is fixed per month or variable per unit. Total the amounts under each category to develop an equation for total monthly costs. Round variable cost answers to two decimal places Fixed Costs Variable costs Cost of food sold 5 Wages and fringe benefits Fees paid delivery help Rent on building Depreciation on equipment OX Utilities Supplies soap floor wax etc.) Administrative costs Total costs equation 05 0.X 0 0 0 OX OX DX 0 X 5 c) Predict total costs for a monthly sales volume of 9.800 units SD Step by Step Solution
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