 # High-low method The manufacturing costs of Carrefour Enterprises for three months of the year follow: Total Cost Units Produced July $300,000 2,700 units August 440,000 5,500 September 325,000 3,500 Using the high-low method, determine (a) the variable cost per unit and (b) the total fixed cost. BuyFind ### Accounting 27th Edition WARREN + 5 others Publisher: Cengage Learning, ISBN: 9781337272094 BuyFind ### Accounting 27th Edition WARREN + 5 others Publisher: Cengage Learning, ISBN: 9781337272094 #### Solutions Chapter Section Chapter 21, Problem 21.1BPE Textbook Problem ## High-low methodThe manufacturing costs of Carrefour Enterprises for three months of the year follow: Total Cost Units Produced July$300,000 2,700 units August 440,000 5,500 September 325,000 3,500 Using the high-low method, determine (a) the variable cost per unit and (b) the total fixed cost.

Expert Solution

(a)

To determine

High-low method: It is the method of estimating the variable cost per unit and the fixed costs by using the highest and the lowest level of activities and their associated costs.

To determine: the variable cost per unit.

### Explanation of Solution

Determine the variable cost per unit.

Difference in total cost =$140,000 (refer Table 1) Difference in units produced =2,800 units (refer Table 1) Variablecostperunit =DifferenceintotalcostDifferenceinunitsproduced=$140,0002

Expert Solution

(b)

To determine
the total fixed cost.

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