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Question #3 The Dolphin Company collected the following annual information on total net sales and total operating costs: Year Total Net Sales Total Operating Costs
Question #3
The Dolphin Company collected the following annual information on total net sales and total operating costs:
Year | Total Net Sales | Total Operating Costs |
2014 | $45,000,000 | $27,400,000 |
2015 | $48,000,000 | $28,000,000 |
In 2016, total net sales are budgeted to be $50,500,000. Using the high-low method, prepare an estimate of total operating costs for 2016, assuming total fixed costs and variable costs as a percentage of total net sales are expected to be the same in 2016 as in 2014 and 2015.
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