Galaxy Ltd needs to identify the cost behavior of the three costs shown below Cost information is provided for three months Month Units Produced Total Costs Cost X Costs per Unit Total Costs Cost Y Costs per Unit Total Costs Cost Z Costs per Unit 1 2,000 $4,000 $6,000 $8,000 2 4,000 $4,000 $8,500 $15,000 3 1,000 $4,000 $5,000 $5,000 Required a Calculate the cost per unit, and then identify how the cost behaves for each of the three costs (fixed, variable, or mixed) Explain your answers b Explain how understanding cost behavior can assist in decision making

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Question: Galaxy Ltd. needs to identify the cost behavior of the three costs shown below. Cost information is provided for three months. Month Units Produced Total

Galaxy Ltd. needs to identify the cost behavior of the three costs shown below. Cost information is provided for three months.

Month	Units Produced	Total Costs Cost X	Total Costs Cost Y	Total Costs Cost Z
1	2,000	$4,000	$6,000	$8,000
2	4,000	$4,000	$8,500	$15,000
3	1,000	$4,000	$5,000	$5,000

Required: a. Calculate the cost per unit, and then identify how the cost behaves for each of the three costs (fixed, variable, or mixed). Explain your answers.
b. Explain how understanding cost behavior can assist in decision-making.

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