Question 4 A manufacturer wishes to establish a procedure to estimate his variable production costs for small desks and chairs production orders. He ascertains the following information for his costs. Required: a. Using the HIGH-LOW method calculate the variable and fixed costs. (Show all workings) (10 marks) b. Using the least squares methods, calculate the fixed and variable costs. Insert your answers in the formula y=bx+a. (10 marks) c. Explain (using diagrams) variable cost and variable cost per unit from the accountant point of view. (5 marks) e) Would you use the cost functions calculated in (a) and (b) to predict cost when 1,500 units were produced? (Total 25 marks) Question 4 A manufacturer wishes to establish a procedure to estimate his variable production costs for small desks and chairs production orders. He ascertains the following information for his costs. Required: a. Using the HIGH-LOW method calculate the variable and fixed costs. (Show all workings) (10 marks) b. Using the least squares methods, calculate the fixed and variable costs. Insert your answers in the formula y=bx+a. (10 marks) c. Explain (using diagrams) variable cost and variable cost per unit from the accountant point of view. (5 marks) e) Would you use the cost functions calculated in (a) and (b) to predict cost when 1,500 units were produced? (Total 25 marks)