Hardigree Insurance has collected the following information over the last six months. $$\begin{array} { c c c }
\text { Month } & \text { Units produced } & \text { Total costs } \
\text { March } & 2,000 & \$ 6,700 \
\text { April } & 3,200 & 9,400 \
\text { May } & 2,200 & 7,100 \
\text { June } & 3,000 & 9,500 \
\text { July } & 2,800 & 8,000 \
\text { August } & 2,100 & 6,600
\end{array}$$ Using the high-low method, how much is the variable cost per unit?

Question

Hardigree Insurance has collected the following information over the last six months. $$\begin{array} { c c c } 
\text { Month } & \text { Units produced } & \text { Total costs } \
\text { March } & 2,000 & \$ 6,700 \
\text { April } & 3,200 & 9,400 \
\text { May } & 2,200 & 7,100 \
\text { June } & 3,000 & 9,500 \
\text { July } & 2,800 & 8,000 \
\text { August } & 2,100 & 6,600
\end{array}$$ Using the high-low method, how much is the variable cost per unit?

Quizplus · Accepted Answer

Variable cost per unit = (Highest total cost - Lowest total cost) / (Highest units produced - Lowest units produced)= (9,500 - 6,600) / (3,200 - 2,000)= 2,900 / 1,200= $2.25

Hardigree Insurance Has Collected the Following Information Over the Last