Discussion Question The table below shows monthly data collected on production costs and on the number of units produced over a twelve month period. Month Total Production Level of Activity (Units Produced) Costs July $230,000 3,500 August 250,000 3,750 September 260,000 3,800 October 220,000 3,400 November 340,000 5,800 December 330,000 5,500 January 200,000 2,900 February 210,000 3,300 March 240,000 3,600 April 380,000 5,900 Мay 350,000 5,600 June 290,000 5,000
Discussion Question The table below shows monthly data collected on production costs and on the number of units produced over a twelve month period. Month Total Production Level of Activity (Units Produced) Costs July $230,000 3,500 August 250,000 3,750 September 260,000 3,800 October 220,000 3,400 November 340,000 5,800 December 330,000 5,500 January 200,000 2,900 February 210,000 3,300 March 240,000 3,600 April 380,000 5,900 Мay 350,000 5,600 June 290,000 5,000
Managerial Accounting
15th Edition
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:Carl Warren, Ph.d. Cma William B. Tayler
Chapter3: Process Cost Systems
Section: Chapter Questions
Problem 8BE
Related questions
Question
d) Using the line of best-fit, determine the company’s fixed cost per month and the
variable cost per unit. (Use 0 & 5,000 units.)
e) Which of the two methods appear more appropriate, is it using the line of best-fit or using the high-low method to calculate the variable cost per unit and the fixed cost?
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