Forster is estimating costs for the last half of the
Forster is estimating costs for the last half of the year based on activity during the first half of the year. The results from January through June are as follows:
Required
A. Using the high/ low cost estimation method, determine the total variable cost per unit made.
B. Using the high/ low cost estimation method, determine the total fixed cost per month.
C. What is the cost estimation equation?
D. Estimate the total cost of 11,000 units are made during July using the equation developed in part (C).
E. Why are the high and low points chosen based on units?
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