In: Accounting
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Answer: |
Variable cost per unit = (Highest Cost (-) lowest Cost) / ( Highest Hours (-) lowest Hours) = ( $ 5,260 (-) $ 2,860 ) / ( 720 (-) 320) = $ 2,400 / 400 = $ 6 Per unit |
Variable cost per unit = $ 6 Per unit |
Fixed cost
= Highest Cost (-) ( Highest Hours x Variable cost per
unit ) = $ 5,260 (-) ( 720 x $ 6) = $ 5,260 (-) $ 4,320 = $ 940 |
Fixed cost = $ 940 |