Byrnes Company accumulates the following data concerning a mixed cost, using units produced as the activity level.
| Units Produced Don't use plagiarized sources. Get Your Custom Essay on compute fixed cost as total cost ndash variable cost per unit times units produced f 608896 Get an essay WRITTEN FOR YOU, Plagiarism free, and by an EXPERT! Just from $10/Page | Total Cost | |
| March | 9,800 | $14,740 |
| April | 8,500 | 13,250 |
| May | 7,000 | 11,100 |
| June | 7,600 | 12,000 |
| July | 8,100 | 12,460 |
(a)Compute the variable- and fixed-cost elements using the high-low method.
(b)Estimate the total cost if the company produces 6,000 units.
Determine the highest and lowest levels of activity.
Compute variable cost per unit as: Change in total costs ÷ (High – low activity level) = Variable cost per unit.
Compute fixed cost as: Total cost – (Variable cost per unit × Units produced) = Fixed cost.
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