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cost t per unit an

cost t per unit an

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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May 350,000 5,600 June 290,000 5,000 a) Determine the variable cost per unit and the fixed cost using the high-low method. b) What is the equation of the total mixed cost function? c) Prepare the scatter diagram, clearly showing any outliers. d) Using the line of best-fit, determine the company's fixed cost per month and the variable cost per unit. (use og 5,000 units.) S. e) In view of the department's cost behaviour pattern, which of the two methods appear more appropriate? Explain your answer,
Transcribed Image Text:May 350,000 5,600 June 290,000 5,000 a) Determine the variable cost per unit and the fixed cost using the high-low method. b) What is the equation of the total mixed cost function? c) Prepare the scatter diagram, clearly showing any outliers. d) Using the line of best-fit, determine the company's fixed cost per month and the variable cost per unit. (use og 5,000 units.) S. e) In view of the department's cost behaviour pattern, which of the two methods appear more appropriate? Explain your answer,
Discussion Question The table below shows monthly data collected on production costs and on the number of units produced over a twelve month period. Month Total Production Level of Activity (Units Produced) Costs July $230,000 3.500 August 250,000 3.750 September 260,000 3.800 October 220,000 3.400 November 340,000 5.800 December 330,000 5.500 January 200,000 2,900 February 210,000 3.300 March 240,000 3.600 April 380,000 5,900 May 350,000 5,600 June 290,000 5,000
Transcribed Image Text:Discussion Question The table below shows monthly data collected on production costs and on the number of units produced over a twelve month period. Month Total Production Level of Activity (Units Produced) Costs July $230,000 3.500 August 250,000 3.750 September 260,000 3.800 October 220,000 3.400 November 340,000 5.800 December 330,000 5.500 January 200,000 2,900 February 210,000 3.300 March 240,000 3.600 April 380,000 5,900 May 350,000 5,600 June 290,000 5,000
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