Question
In: Accounting
Relevant Range and High-Low Method The following selected data relate to the major cost categories experienced...
Relevant Range and High-Low Method
The following selected data relate to the major cost categories
experienced by Shaw Company at varying levels of operating volumes.
Assuming that all operating volumes are within the relevant range,
calculate the appropriate costs in each column in which blanks
appear:
| Total Cost (@ 3,000 Units) | Total Cost (@ 4,000 units) | Variable Cost per Unit | Total Fixed Cost | Total Cost (@ 5,000 units) | |
|---|---|---|---|---|---|
| Direct labor (variable) | $51,000 | $68,000 | Answer | Answer | Answer |
| Factory supervision (semi-variable) | 50,000 | 65,000 | Answer | Answer | Answer |
| Factory depreciation (fixed) | 21,000 | 21,000 | Answer | Answer | Answer |
Solutions
Expert Solution
- Working to calculate Factory Supervision Variable and Fixed components using High Low Method
|
Units |
Cost |
||
|
High Level |
4,000 |
$ 65,000.00 |
|
|
Low Level |
3,000 |
$ 50,000.00 |
|
|
Difference |
1,000 |
$ 15,000.00 |
|
|
A |
Difference in Cost |
$ 15,000.00 |
|
|
B |
Difference in units |
1,000 |
|
|
C = A/B |
Variable cost per unit |
$ 15.00 |
|
|
Working |
High Level |
Low Level |
|
|
A |
Total Cost |
$ 65,000.00 |
$ 50,000.00 |
|
B |
Total Units |
4000 |
3000 |
|
C |
Variable cost per unit |
$ 15.00 |
$ 15.00 |
|
D = B x C |
Total Variable cost |
$ 60,000.00 |
$ 45,000.00 |
|
E = A - D |
Total Fixed Cost |
$ 5,000.00 |
$ 5,000.00 |
- Answers
|
Total Cost (@ 3,000 Units) |
Total Cost (@ 4,000 units) |
Variable Cost per Unit |
Total Fixed Cost |
Total Cost (@ 5,000 units) |
|
|
Direct labor (variable) |
$51,000 |
$68,000 |
$17 |
$0 |
$85,000 |
|
Factory supervision (semi-variable) |
$50,000 |
$65,000 |
$15 |
$5,000 |
$80,000 |
|
Factory depreciation (fixed) |
$21,000 |
$21,000 |
$0 |
$21,000 |
$21,000 |
ekkarill92 answered 2 years agoRelated Solutions
Relevant Range and High-Low Method The following selected data relate to the major cost categories experienced...
Relevant Range and High-Low Method The following selected data
relate to the major cost categories experienced by Shaw Company at
varying levels of operating volumes. Assuming that all operating
volumes are within the relevant range, calculate the appropriate
costs in each column in which blanks appear: Total Cost (@ 3,000
Units) Total Cost (@ 4,000 units) Variable Cost per Unit Total
Fixed Cost Total Cost (@ 5,000 units) Direct labor (variable)
$57,000 $76,000 $Answer $Answer $Answer Factory supervision
(semi-variable) 50,000...
Question text Relevant Range and High-Low Method The following selected data relate to the major cost...
Question text
Relevant Range
and High-Low Method
The following selected data relate to the major cost categories
experienced by Shaw Company at varying levels of operating volumes.
Assuming that all operating volumes are within the relevant range,
calculate the appropriate costs in each column in which blanks
appear:
Total Cost (@ 3,000 Units)
Total Cost (@ 4,000 units)
Variable Cost per Unit
Total Fixed Cost
Total Cost (@ 5,000 units)
Direct labor (variable)
$72,000
$96,000
Answer
Correct
Mark 1.00 out...
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Total Costs
104,500
$30,703,250
119,500
33,380,750
136,500
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