Question

The manufacturing cost of Mocha Industries for three months of the year are provided below: Total Cost Production April 1,370

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Answer #1

A) Variable cost = (Cost at highest activity - Cost at lowest activity) /(Highest activity-Lowest activity)

= (84,170-75,005)/(2780-1370)

= 6.5 per unit

​​​​​​B) Fixed cost = Total cost - Variable cost

= 84,170 - (2780*6.5)

= 66,100

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