4. CEX.03.04 High-Low Method to Determine Fixed Cost and Variable Rate guipment ber of ar Dohini Manufacturing Company had the following 12 months of data on purchasing cost and number of purchase orders Purchasing Cost $18,660 Number of Purchase Orders st yea Month January February March April May 18,065 19.250 370 330 370 18,050 410 400 orintUnt June 450 460 19,345 19,500 19,670 (20.940 19,430 20.020 18,800 19,340 July August September October November December (560 440 500 470 480 Required: 1. Determine the high point and the low point. Month with high number of purchase orders Month with low number of purchase orders August vary februa 2. Calculate the variable rate for purchasing cost based on the number of purchase orders. (Round to the nearest cent.) $ per purchase order 12.56 3. Calculate the fixed monthly cost of purchasing. 560 $ 20 4. Write the cost formula for the purchasing activity showing the fixed cost and the variable rate. Round variable rate to the nearest cent. Total purchasing cost = $ + ($ 5. If Dohini Manufacturing Company estimates that next month will have 430 purchase orders, what is the total estimated purchasing cost for that month? $ 6. What if Dohini Manufacturing wants to estimate purchasing cost for the coming year and expects 5,340 purchase orders? What will estimated total purchasing cost be? $ What is the total fixed purchasing cost? $ Why doesn't it equal the fixed cost calculated in Requirement 3 above? 5. EX.03.20