Question: Liberty Inc. has decided to use the high-low method to estimate costs. The data for various levels of production are as follows: Units Produced ............

Liberty Inc. has decided to use the high-low method to estimate costs. The data for various levels of production are as follows:

Units Produced ............ Total Costs

100,000 ..................... $1,800,000

180,000 ...................... 2,800,000

300,000 ...................... 4,300,000

a. Determine the variable cost per unit and the fixed cost.

b. Based on part (a), estimate the total cost for 260,000 units of production?

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