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1) 2) Round to 2 decimal places Month Packing Costs No. of Orders Weight Fragile

ID: 2824774 • Letter: 1

Question

1)

2)

Round to 2 decimal places

Month Packing Costs No. of Orders Weight Fragile Items 1 $            45,000 11,200 24,640 1,120 2                58,000 14,000 31,220 1,400 3                39,000 10,500 18,000 1,000 4                35,600 9,000 19,350 850 5                90,000 21,000 46,200 4,000 6              126,000 31,000 64,000 5,500 7                90,600 20,000 60,000 1,800 8                63,000 15,000 40,000 750 9                79,000 16,000 59,000 1,500 10              155,000 40,000 88,000 2,500 11              450,000 113,500 249,700 11,800 12              640,000 150,000 390,000 14,000 13                41,000 10,000 23,000 900 14                54,000 14,000 29,400 890 15                58,000 15,000 30,000 1,500 16                58,090 14,500 31,900 1,340 17                80,110 18,000 50,000 3,000 18              123,000 30,000 75,000 2,000 19              108,000 27,000 63,450 1,900 20                76,000 18,000 41,400 1,430 Totals $       2,469,400              597,700           1,434,260                59,180

Explanation / Answer

1) Variable Cost per Order: Cost No. of Orders High 640000 150000 Low 35600 9000 Difference 604400 141000 Variable Cost per order $                4.29 Fixed Cost: Using High Activity $                   -2,978.72 Using Low Activity $                   -2,978.72 Cost Equation: Y = -$2978.72+$4.29*x 2) PART 4 Cost Estimate given activity data: Estimated Activity No. of Orders           26,000 Can only use this Weight of Orders           57,000 No of Fragile Items                900 Cost Estimate $     1,08,561.28