QUESTION 35 USE THE FOLLOWING INFORMATION FOR QUESTIONS 35-37: Taylor\'s Treasur

Question

QUESTION 35 USE THE FOLLOWING INFORMATION FOR QUESTIONS 35-37: Taylor's Treasures has collected the following information over the last six months for Units Produced and Total Costs, respectively: March 10,000 $25,600 April 12,000 $26,200 May 18,000 $27,600 June 13,000 $26,450 July 12,000 $26,000 August 15,000 $26,500. Using the high-low method, what is the variable cost per unit? O a S0.22 O b. S0.25 $2.00 O d $2.56 QUESTION 36 Using the high-low method, what is the total fixed cost? O a $23,100 O b.$1,000 C. $5,600 O d $4,500

Explanation / Answer

23100

35. Option B is correct, 0.25

36. Option A is correct, 23100

High Cost 27600 Low cost 25600 High Cost units 18000 Low cost units 10000 Variable cost per unit (Difference in costs/ difference in units (27600-25600)/(18000-10000) 0.25 Cost = .25*units + fixed cost 27600=.25*18000+ Fixed cost Fixed cost = 27600-4500 Fixed cost

23100

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