QUESTION 2

You are given the following data for DDD (Pty) Ltd from January to July.

Month	Activity Level (units)	Maintenance cost incurred
January	5,600	P7,900
February	7,100	P8,500
March	5,000	P7,400
April	6,500	P8,200
May	7,300	P9,100
June	8,000	P9,800
July	6,200	P7,800

Required:

1. Calculate the fixed cost element using the high-low method. (8 marks)

2. Calculate the cost of producing 10, 000 units. (4 marks)