High-Low MethodThe manufacturing costs of Ackerman Industries for the first three months of the year follow: Total CostsUnits ProducedJanuary$1,900,000 20,000unitsFebruary2,250,000 27,000 March2,400,000 30,000 Using the high-low method, determine (a) the variable cost per unit and (b) the total fixed cost.a.  Variable cost per unit$b.  Total fixed cost$ Feedback

Question
Asked Apr 3, 2019

High-Low Method

The manufacturing costs of Ackerman Industries for the first three months of the year follow:

  Total Costs Units Produced
January $1,900,000   20,000 units
February 2,250,000   27,000  
March 2,400,000   30,000  

Using the high-low method, determine (a) the variable cost per unit and (b) the total fixed cost.

a.  Variable cost per unit $
b.  Total fixed cost $
 
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check_circleExpert Solution
Step 1

Calculate the difference in the total costs and units produced under High-low method.

Hint: The high-low level is identified by using the total costs.

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Step 2

a. Calculate the variable cost per unit:

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Step 3

Calculate the variable cost under 30,000 ...

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