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Rooney Woodcraft Company manufactures antique wooden cabinets to house modern televisions. The Company began operations in January of last year. Sidney Myrick, the owner, asks
Rooney Woodcraft Company manufactures antique wooden cabinets to house modern televisions. The Company began operations in January of last year. Sidney Myrick, the owner, asks for your assistance. He believes that he needs to better understand the cost of the cabinets for pricing purposes. You have collected the following data concerning actual production over the past year: Month Number of Cabinets Produced Total Cost January 850 $ 21,500 February 3,670 32,500 March 1,910 29,400 April 600 18,600 May 1,620 28,500 June 1,250 27,500 July 1,110 25,100 August 1,710 32,000 September 2,270 32,200 October 2,960 31,000 November 3,290 32,600 December 330 5,780 Required To understand the departments cost behavior, you decide to plot the points on graph paper and sketch a total cost line. (1) Enter the number of units and their costs in increasing order. Using the high-low method, compute the total cost equation for the preceding data. (1) Compute the variable cost per unit. (2) Compute total fixed costs. (4) Calculate the total cost assuming 2,900 cabinets are made
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