Please show work. Thanks. The following data is available regarding costs and un
ID: 2506141 • Letter: P
Question
Please show work. Thanks.
The following data is available regarding costs and units:
Observation Machine-hours Total Operating Costs
January 4,000 $45,900
February 5,000 52,500
March 3,400 44,025
April 4,400 48,000
May 4,500 49,200
Required:
a. Use the high-low method to determine variable cost per unit and the fixed costs.
b. If June's estimated machine-hours total 4,200, what are the total estimated costs of the Machining Department? What are the costs per hour?
Variable Cost Per Unit ___________________________________
Fixed Costs ____________________________________
Costs @ 4,200 units ____________________________________
Cost Per Hour @ 4,200 ____________________________________
Explanation / Answer
a. Use the high-low method to determine variable cost per unit and the fixed costs.
High month: February 5,000
Low month: March 3,400
Variable cost = (52,500