Question $3$

$($a$)$ Dobo Limited incurred the costs as indicate below. During the six months ended

$30$ June, these costs changed, but not in direct relation to the volume.

Required:

$($i$)$ Use the high$-$low method to determine the variable cost per unit and the

total fixed costs.

$($ii$)$ Formulate a linear equation that explains and predicts cost behaviour.

$(2$ marks$)$

$($iii$)$ Forecast the total costs if an estimated $110$ units are to be manufactured

in July.

$(2$ marks$)$

$($b$)$ Listed below are a number of costs incurred by organisations:

$($i$)$ The piecemeal wages of the workers assembling computers.

$($ii$)$ Magazine subscriptions for the factory canteen the boxes used to ship the

detergent produced by a company to its customers.

$($iii$)$ The factory supervisor's salary.

$($iv$)$ Executive directors' life insurance.