In: Accounting
Using the high-low method, Vogel Corp. has $90,000 of mixed costs for 31,000 units produced in June and $83,000 for 27,000 units produced in October.
Vogel's variable cost per unit (to the nearest penny) is:
Units Produced | Total cost | |
High LEVEL | 31,000 | 90,000 |
Low Level | 27,000 | 83,000 |
Change | 4000 | 7000 |
Change per unit (Variable cost) =Change in Total cost/ Change in Units Produced | ||
Change in Total cost | 7000 | |
Change in Units Produced | 4000 | |
Variable cost per unit | 1.75 |