ACCT2020 Intro ACCOUNTING eek #11 : Chapter 18 Questions 9-10 (of 10) The follow

Question

ACCT2020 Intro ACCOUNTING eek #11 : Chapter 18 Questions 9-10 (of 10) The following information applies to the questions displayed below) Alden Co's monthly sales and cost data for its operating activties of the past year follow. Management wants to use these data to predict future fixed and variable costs Monthillama Sale -Total Cost Month S tal Cost $359,000 270,736 152,750 64,000 31,625 95,000 80,650 $ 321,000 $158,500 166,000 102,250 8 266,000 206,600 206,000101.000 291,000 202,500 91,000113,00012 271,000 75,800 151,000 95,000 101,000 3 4. 10 6 2.00 points

Explanation / Answer

High-Low method - Calculation of Variable Cost per Sales Dollar Change in cost Cost at high point minus cost at low point 206736 $       0.73 per sales dollar Change in volume Volume at high point minus volume at low point 283200 High-Low method - Calculation of Fixed Costs Total cost at the high point 270736 Variable costs at the high point: Volume at the high point 359000 sales dollars Variable cost per sales dollar 0.73 Total variable costs at the high point 262070 Total fixed costs 8666 Total cost at the low point 64000 Variable costs at the low point: Volume at the low point 75800 sales dollars Variable cost per sales dollar 0.73 Total variable costs at the low point 55334 Total fixed costs 8666

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