Problem 21-2A Scatter diagram and cost behavior estimation LO P1 [The following information applies to the questions displayed below.] Alden Co.s monthly unit sales and total cost data for its operating activities of the past year follow. Management wants to use these data to predict future fixed and variable costs. Month Units Sold Total Cost Month

Units Sold Total Cost Month Unit Sold Total Cost

month1 325,000 $162,500 7 355,000 $ 242,000

month 2 170,000 106,250 8 275,000 156,750

month 3 270,000 210,600 9 75,000 60,000

month 4 210,000 105,000 10 155,000 135,625

month 5 295,000 206,500 11 99,000 99,000

month 6 195,000 17,000 12 105,000 76,650

2. Problem 21-2A Part 2 2. Estimate both the variable costs per unit and the total monthly fixed costs using the high-low method. (Do not round intermediate calculations.)

3. Predict future total costs when sales volume is (a) 380,000 units and (b) 420,000 units.

1. Estimate Product XTs break-even point in terms of sales units and sales dollars. (1 unit = 100 yards) (Do not round intermediate calculations.)

Contribution margin			per 100 yds.
	Contribution margin
Contribution margin ratio
	Choose Numerator:	/	Choose Denominator:	=	Contribution margin ratio
		/		=	Contribution margin ratio
1(a) Estimate Product XTs break-even point in terms of sales units. (1 unit = 100 yards)
	Choose Numerator:	/	Choose Denominator:	=	Break-even units
		/		=	Break-even units
1(b) Estimate Product XTs break-even point in terms of sales dollars.
	Choose Numerator:	/	Choose Denominator:	=	Break-even dollars
		/		=	Break-even dollars

Problem 21-3A Part 2

3. Prepare a contribution margin income statement showing sales, variable costs, and fixed costs for Product XT at the break-even point.