Phillips Company manufactures air-conditioning units for commercial buildings and has noticed considerable variation in shipping expenses from month to month as per the data below: Month Units Shipped Total Shipping Expense January 4 $2,200 February 4 $3,100 March 5 $2,600 April 2 $1,500 May 3 $2,200 June 6 $3,000 July 8 $3,600 3–1 Which two months should be used if Phillips wants to estimate the behaviour of shipping expenses using the high–low method? 3–2 Using the high–low method, what is the variable cost per unit to ship air conditioners? 3–3 What is the fxed cost of shipping air conditioners? 3–4 What is the cost formula for shipping expenses? 3–5 If seven air conditioners are shipped in August, estimate the total shipping expenses. 2 of 3 02/17/21 3–6 If nine air conditioners are shipped in September, estimate the fxed shipping expenses. 3–7 If 10 air conditioners are shipped in October, estimate the variable shipping expense. 3–8 Page 82If the air conditioners have an average sales price of $5,000, variable manufacturing costs are $2,500 per unit, variable manufacturing overhead is $500 per unit, and variable selling and administration costs (excluding shipping) are $200 per unit, what is the contribution margin per unit? 3–9 Given the facts in part 3–8, estimate the total contribution margin for August if seven air conditioners are produced and sold. 3-10 Given the facts in part 3–8, if total fxed costs (excluding shipping) are $3,000 per month, estimate operating income for August if seven air conditioners are produced and sold. 3–11 By how much would the total contribution margin decrease in August if Phillips decides to offer its customers a 5% price discount on the seven units? 3–12 By how much would operating income decrease in August if Phillips decides to offer its customers a 5% price discount on the seven units? 3–13 Estimate variable shipping expenses to ship 12 air conditioners if the shipping company reduces the variable cost per unit by 10% for each unit shipped in excess of 10 units. 3–14 Given the facts in part 3–13, estimate total shipping expenses for 12 air conditioners. 3–15 Given the facts in part 3–13, are variable shipping expenses linear or non-linear? Explain.