Assume a company reports the following mixed costs: MIXED COSTS
Question:
Assume a company reports the following mixed costs:
MIXED COSTS
Machine Hours Electric Power Costs
April 15,000 $1,950
May 17,000 $2,080
June 18,000 $2,150
July 14,000 $1,900
August 20,000 $2,200
September 19,000 $2,170
- Calculate Variable Cost per Unit
Variable Cost/Unit = Cost at High Level - Cost at Low Level / High Output - Low Output
Variable Cost/Unit =
Calculate fixed costs for this company.
Total Cost at High Level = Fixed Cost + Variable Cost at High Level
Rearranged: Fixed Cost = Total Cost at High Level - (Variable Cost/Unit x High Output)
Fixed Costs =
Cornerstones of Managerial Accounting
ISBN: 978-0176530884
2nd Canadian edition
Authors: Maryanne M. Mowen, Don Hanson, Dan L. Heitger, David McConomy, Jeffrey Pittman