Question E3 (a) The following costs have been extracted from the records of Organic-Soap Enterprise: (b) Month January February March April May June Activity level Total cost Pieces RM 14,050 540,200 14,530 562,500 13,880 498,250 13,400 510,500 12,990 465,350 12,280 472,500 Required: (i) Calculate the fixed costs per month and variable cost per piece using the High-Low method. (10 marks) (ii) Estimate total cost when the following number of units are produced: a. 13100 units (2 marks) b. 14750 units (2 marks) A manufacturing company is searching for a method that helps to identify variable cost per unit and fixed cost. In the last meeting, one of the accountants suggested that High-low method should be considered. The owner learns that you have completed a cost accounting course recently and seeks your opinion. Required: Identify and discuss the possible challenges that management may face when such method is implemented. (6 marks) (Total 20 marks)