Homework Answers
Answer)
Calculation of Variable cost per unit using High-low method
Variable cost per unit = (Highest Activity Shipping Cost – Lowest Activity Shipping Cost)/ (Highest Activity number of units shipped – Lowest Activity number of units shipped)
= (RM 1,500 – RM 1,100)/ (130 packages – 90 packages)
= RM 400/ 40 packages
= RM 10 per package
Therefore variable cost is RM 10 per package.
Calculation of Total fixed cost Using high-low method
Fixed cost = Highest Activity Shipping cost – (Variable cost per unit X Highest Activity number of units shipped)
= RM 1,500 – (RM 10 per package X 130)
= RM 1,500 – RM 1,300
= RM 200.
Therefore total fixed cost is RM 200.
Notes:
· Highest Activity shipping cost means the cost of shipping the highest number of packages. In the given question the highest number of shipped packaged is 130 units (in the month of April) and the corresponding Shipping cost is RM 1,500.
· Lowest Activity shipping cost means the cost of shipping the lowest number of packages. In the given question the lowest number of shipped packaged is 90 units (in the month of June) and the corresponding Shipping cost is RM 1,100.
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Required: 1-a. Prepare a scattergraph using the data given above. Plot cost on the vertical axis...
Required:
1-a. Prepare a scattergraph using the data given above. Plot
cost on the vertical axis and activity on the horizontal axis.
Instructions:
1. On the graph below, use the point tool (January) to
plot units shipped on the horizontal axis and the shipping expense
on the vertical axis.
2. Repeat the same process for the plotter tools
(February to July).
3. To enter exact coordinates, click on the point and
enter the values of x and y.
4. To...
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Presented below are the production data for the first six months of the year for the mixed costs incurred by Venus Company. Month Units January February March April May June Cost $5,350 $4,550 $6,810 $10,200 $5,900 $7,360 4,100 3,500 5,530 8,500 5,100 6,530 Venus Company uses the high-low method to analyze mixed costs. How would the cost function be stated? A. y = $5,650 + $1.30X B. y = $595 + $1.13X C. y = $10,200 + $1.20X OD. y...
Required:
1-a. Prepare a scattergraph using the data given above. Plot
cost on the vertical axis and activity on the horizontal axis.
Instructions:
1. On the graph below, use the point tool (January) to
plot units shipped on the horizontal axis and the shipping expense
on the vertical axis.
2. Repeat the same process for the plotter tools
(February to July).
3. To enter exact coordinates, click on the point and
enter the values of x and y.
4. To...
The following data relating to units shipped and total shipping expense have been assembled by Archer Company, a manufacturer of large, custom-built air-conditioning units for commercial buildings: Units Shipped Month January February March April May June Total Shipping Expense $ 5,020 3,480 4,240 3,430 1.940 8.110 1,660 July Required: 1. Estimate a cost formula for shipping expense using the high-low method. Y= + x 2. Not available in Connect 3. What factors, other than the number of units shipped, are...
Maintenance costs at Seaside Manufacturing over the past six months are listed in the following table. Month January February March April Maintenance cost $13,600 $14,720 $13,000 $14,480 $17,000 $13,200 Machine hours 15,500 16,900 13,000 16,600 18,000 15,000 May June Using the high-low method, what would the total maintenance costs be if 17,500 machine hours were used? (Round any intermediary calculations to the nearest cent.) O A. $16,600 OB. $3,000 OC. $14,000 OD. $32,000 Maintenance costs at Seaside Manufacturing over the...
Maintenance costs at Seaside Manufacturing over the past six months are listed in the following table. Month January February March April May June Maintenance cost $13,600 $14,720 $12,460 $14,480 $15,380 $13,200 Machine hours 15,500 16,900 13,700 16,600 17,400 15,000 Using the high-low method, what would the variable maintenance cost per machine hour be? O A. $0.88 OB. $0.91 OC. $0.79 OD. $1.27
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