Giving the following data for XY Company year 2008 2009 Total Sales $145,0000 $121,4000 Cost of...
Giving the following data for XY Company
|
year |
2008 |
2009 |
|
Total Sales |
$145,0000 |
$121,4000 |
|
Cost of goods sold |
$880,000 |
$738,400 |
|
Selling & Administrative Expenses |
$92,500 |
$80,700 |
Assume high-low method is adequate in this case, the variable costs of cost of goods sold per unit is
| 1. |
40% |
|
| 2. |
50% |
|
| 3. |
60% |
|
| 4. |
65% |
Homework Answers
Answer-----------(3) 60%
Working
| Sales | $ 1,214,000.00 |
| Variable cost (1214000 x 0.60) | $ 728,400.00 |
| Fixed cost | $ 10,000.00 |
| Total cost | $ 738,400.00 |
| Variable cost ratio (728400/1214000) | 60% |
Working note 2
For this question i have assumed that sales price is $1 per unit so it gives sales units as equal to sales revenue.
| Cost | No. of activities | ||
| A | High Level | $ 880,000.00 | 1450000 |
| B | Low Level | $ 738,400.00 | 1214000 |
| C=A-B | Difference | $ 141,600.00 | 236,000 |
| A | Cost difference | $ 141,600.00 | |
| B | No. of activities difference | 236000 | |
| C=A/B | Variable cost per unit | $ 0.60 | |
| High Level | Low Level | ||
| A | No. of activities | 1450000 | 1214000 |
| B | Variable cost per unit | $ 0.6000 | $ 0.6000 |
| C=AxB | Total Variable cost | $ 870,000.00 | $ 728,400.00 |
| D | Total cost | $ 880,000.00 | $ 738,400.00 |
| E=D-C | Total fixed cost | $ 10,000.00 | $ 10,000.00 |
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Giving the following data for XY Company
year
2008
2009
Total Sales
$145,0000
$121,4000
Cost of...
Giving the following data for XY Company year 2008 2009 Total Sales $145,0000 $121,4000 Cost of...
Giving the following data for XY Company year 2008 2009 Total Sales $145,0000 $121,4000 Cost of goods sold $880,000 $738,400 Selling & Administrative Expenses $92,500 $80,700 Assume high-low method is adequate in this case, the total fixed costs of selling and administrative expenses is 1. $10,000 2. $12,000 3. $15,000 4. $20,000
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