The following data relates to monthly costs for the production of mobile phones: Units 5,000 8,000 Rent
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Question:
The following data relates to monthly costs for the production of mobile phones:
Units | 5,000 | 8,000 |
Rent | $44,000 | $44,000 |
Supervisors' Wages | $8,400 | $8,400 |
Electricity | $174,000 | $264,000 |
Materials | $160,000 | $256,000 |
Labor | $156,000 | $216,000 |
Administration Costs | $82,000 | $88,000 |
Selling and Distribution Costs | $60,000 | $60,000 |
Required:
Identify whether each cost is:
- fixed, variable
- semi-variable
Using the high-low method and calculating the fixed and variable elements of each.
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