To estimate the fixed and variable elements of semi-variable costs, records of costs in previous periods...

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To estimate the fixed and variable elements of semi-variable costs, records of costs in previous periods are reviewed and the costs of the following two periods are selected. The period with the highest volume of output and the period with the lowest volume of output. Production Volume (Units) 9000 15000 3 7700 4 101000 7000 Evaluate the effect of an increase in one unit of production on the firms' variable costs and fixed costs (Ignore inflation). The costs of operating the maintenance department of a television manufacturer for the last four months have been as follows: Month 1 2 Total Cost ($) 125000 213000 111000 (b) Based on the calculation in part (a) evaluate the estimated costs of 10,500 units of output. (18 marks) To estimate the fixed and variable elements of semi-variable costs, records of costs in previous periods are reviewed and the costs of the following two periods are selected. The period with the highest volume of output and the period with the lowest volume of output. Production Volume (Units) 9000 15000 3 7700 4 101000 7000 Evaluate the effect of an increase in one unit of production on the firms' variable costs and fixed costs (Ignore inflation). The costs of operating the maintenance department of a television manufacturer for the last four months have been as follows: Month 1 2 Total Cost ($) 125000 213000 111000 (b) Based on the calculation in part (a) evaluate the estimated costs of 10,500 units of output. (18 marks)

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