   Chapter 21, Problem 21.1BPE

Chapter
Section
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. (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 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

(b)

To determine
the total fixed cost.

Still sussing out bartleby?

Check out a sample textbook solution.

See a sample solution

The Solution to Your Study Problems

Bartleby provides explanations to thousands of textbook problems written by our experts, many with advanced degrees!

Get Started

Find more solutions based on key concepts 