Question
Stein corporation wants to find an equation to estimate some of their monthly operating costs for the operating budget for 2018. The following cost and
Stein corporation wants to find an equation to estimate some of their monthly operating costs for the operating budget for 2018.
The following cost and other data were gathered for 2017
Requirement :
| . | Which of the preceding costs is variable? Fixed? Mixed? Explain. |
| 2. | Using the high-low method, determine the cost function for each cost. |
| 3. | Combine the preceding information to get a monthly operating cost function for the Stein Corporation. |
| 4. | Next month, Stein expects to use400 machine hours, have80 employees, and ship9,000 units. Estimate the total operating cost for the month. |
Requirement 1. Which of the preceding costs is variable? Fixed? Mixed? Explain.
| Cost | ||
| Cost | function | Explanation |
| Maintenance |
|
|
| Health insurance |
|
|
| Shipping costs |
|
|
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Managerial Accounting
Authors: Ray H. Garrison, Eric W. Noreen, Peter C. Brewer
13th Edition
978-0697789938
