- All working forms part of the answer
- Working: HIGH LOW Method
|
Months
|
Units
|
Cost
|
|
High Level
|
Sept
|
700
|
$
6,600.00
|
|
Low Level
|
Aug
|
300
|
$
5,000.00
|
|
Difference
|
|
400
|
$
1,600.00
|
|
A
|
Difference in Cost
|
$
1,600.00
|
|
B
|
Difference in units
|
400
|
|
C = A/B
|
Variable cost per unit
|
$
4.00
|
|
|
|
|
|
Working
|
|
High
Level
|
Low
Level
|
|
A
|
Total Cost
|
$
6,600.00
|
$
5,000.00
|
|
B
|
Total Units
|
700
|
300
|
|
C
|
Variable cost per unit
|
$
4.00
|
$
4.00
|
|
D = B x C
|
Total Variable cost
|
$
2,800.00
|
$
1,200.00
|
|
E = A - D
|
Total Fixed Cost
|
$
3,800.00
|
$
3,800.00
|
Fixed Cost = $ 3,800
Variable Cost per unit = $ 4.00
Total cost for 450 cavities = $ 3800 +
($4 x 450)
= 3800 + 1800
= $ 5,600 = Answer
