Inspection costs at one of Ratulowski Corporation's factories are listed below: Management believes that inspection cost is a mixed cost that depends on units produced.
Using the high-low method, the estimate of the variable component of inspection cost per unit produced is closest to:

Question

Inspection costs at one of Ratulowski Corporation's factories are listed below:  Management believes that inspection cost is a mixed cost that depends on units produced.
Using the high-low method, the estimate of the variable component of inspection cost per unit produced is closest to:

Quizplus · Accepted Answer

11eacbfc_c8ad_ec65_8ffe_c9e898c1c365_TB7552_00 Variable cost per unit = Change in cost ÷ Change in activity
= $619 ÷ 76 units
= $8.14 per unit

Inspection Costs at One of Ratulowski Corporation's Factories Are Listed