# W & O Inc. has decided to use the high-low method to estimate the total cost and the fixed and

## Question:

W & O Inc. has decided to use the high-low method to estimate the total cost and the fixed and variable cost components of the total cost. The data for various levels of production are as follows:

Units

Produced Total Costs

10,000 $750,000

22,500 845,000

30,000 950,000

a. Determine the variable cost per unit and the fixed cost.

b. Based on part (a), estimate the total cost for 25,000 units of production.

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## Step by Step Answer:

**Related Book For**

## Accounting

**ISBN:** 978-0324401844

22nd Edition

**Authors:** Carl S. Warren, James M. Reeve, Jonathan E. Duchac

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