The Roasted Chicken House Restaurant has provided you with the following information on its costs at...
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The Roasted Chicken House Restaurant has provided you with the following information on its costs at various levels of monthly sales. Monthly sales units Cost of food Supplies Other operating costs Utilities 400 800 1,200 17,000 1,200 9,000 10,000 800 400 2,000 4,000 6,000 500 900 1300 2,000 2,000 Building rent Depreciation Total cost 2,000 200 200 200 14,100 17,900 27,700 Required 1. Draw scatter graph for each cost items and explain cost behaviour. 2. Identify each cost as variable, fixed or semi-variable (mixed) cost with reasons. 3. Segregate semi-variable cost, if any, using high-low method and develops an equation for each cost items. 4. Segregate semi-variable cost, if any, using least square method and develops an equation for each cost items. 5. Predict total cost for monthly budgeted outputs for 1,000 units as per results of (3) above. 6. Predict total cost for monthly budgeted outputs for 1,000 units as per results of (4) above. 7. Compare results of above (5) and (6), and draw conclusion about reliability of these two results with valid reasons. The Roasted Chicken House Restaurant has provided you with the following information on its costs at various levels of monthly sales. Monthly sales units Cost of food Supplies Other operating costs Utilities 400 800 1,200 17,000 1,200 9,000 10,000 800 400 2,000 4,000 6,000 500 900 1300 2,000 2,000 Building rent Depreciation Total cost 2,000 200 200 200 14,100 17,900 27,700 Required 1. Draw scatter graph for each cost items and explain cost behaviour. 2. Identify each cost as variable, fixed or semi-variable (mixed) cost with reasons. 3. Segregate semi-variable cost, if any, using high-low method and develops an equation for each cost items. 4. Segregate semi-variable cost, if any, using least square method and develops an equation for each cost items. 5. Predict total cost for monthly budgeted outputs for 1,000 units as per results of (3) above. 6. Predict total cost for monthly budgeted outputs for 1,000 units as per results of (4) above. 7. Compare results of above (5) and (6), and draw conclusion about reliability of these two results with valid reasons.
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12 Bcratter graph pg1 4 2 00 800 1200 Monthly sales In unita graph ... View the full answer
Related Book For
Financial Accounting Tools for Business Decision Making
ISBN: 978-1118644942
6th Canadian edition
Authors: Paul D. Kimmel, Jerry J. Weygandt, Donald E. Kieso, Barbara Trenholm, Wayne Irvine
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