6. What is the amount of thetotal variable cost element ofinspection cost at the highactivity level? *$4,900$5,780$11,050$16,830None of the above7. What is the amount of thefixed cost element of inspectioncost? *$4,900$4,930$5,780$11,050None of the above The management of GregoryCorporation believes that theinspection cost is a mixed cost thatdepends on units produced. The high-low method is used to estimate thevariable and fixed components of thiscost. The total inspection costs atGregory's factory are listed below.MonthUnits ProducedInspection CostJanuary990S21,730February985$21,645March807SIR619April650SI5,950May760$17,820June870S19,690July805SI8,585August810SIRA0September700S16,3005. What is the variable cost perunit? *$8.50 per unit$17.00 per unit$21.95 per unit$22.98 per unitNone of the above

High Low Method is the method to separate mixed cost into fixed Cost and Variable Cost

Month Units Produced Inspection Cost Janary 990 S21,730 Fehrary $214S March SIRA19 April 650 SI5,950 May 760 S1720 June 870 S190 Auly SIKSRS SIRATO August September 700 S16,100 5. What is the variable cost per unit? *

Month Units Produced Inspection Cost Janary 990 S21,730 Fehrary $214S March SIRA19 April 650 SI5,950 May 760 S1720 June 870 S190 Auly SIKSRS SIRATO August September 700 S16,100 5. What is the variable cost per unit? *

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter4: Activity-based Costing

Section: Chapter Questions

Problem 4CE: Larsen, Inc., produces two types of electronic parts and has provided the following data: There are...

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Method of Least Squares, Predicting Cost for Different Time Periods from the One Used to Develop a Cost Formula Farnsworth Company has gathered data on its overhead activities and associated costs for the past 10 months. Tracy Heppler, a member of the controller's department, has convinced management that overhead costs can be better estimated and controlled if the fixed and variable components of each overhead activity are known. One such activity is receiving raw materials (unloading incoming goods, counting goods, and inspecting goods), which she believes is driven by the number of receiving orders. Ten months of data have been gathered for the receiving activity and are as follows: Month Receiving Orders Receiving Cost 1 1,000 $18,000 2 700 $15,000 3 1,500 $28,000 4 1,200 $17,000 5 1,300 $25,000 6 1,100 $21,000 7 1,600 $29,000 8 1,400 $24,000 9 1,700 $27,000 10 900 $16,000 Assume that Tracy…