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Luba_88 [7]
3 years ago
7

Mountain Dental Services is a specialized dental practice whose only service is filling cavities. Mountain has recorded the foll

owing for the past nine months:Number of CavitiesMonth Filled Total CostJanuary 475 $5,750February 575 6,250March 350 5,200April 675 6,500May 500 5,650June 400 5,250July 625 6,300August 650 6,000September 450 5,450Use the high-low method to estimate total fixed cost and variable cost per cavity filled. Round your answers to 2 decimal places.Fixed Cost _____Variable Cost per Unit _____Using these estimates, calculate Mountain's total cost for filling 550 cavities.Estimated Total Cost _____
Business
1 answer:
Phantasy [73]3 years ago
3 0

Answer:

The fixed cost, variable cost per unit and the total cost is $3,800, $4 per unit ,and $6,000 respectively

Explanation:

1. The computation of the variable cost per unit is shown below:

= (High total cost -  low total cost) ÷ (High number of cavities - low number of cavities)

= ($6,500 - $5,200) ÷ (675 - 350)

= $1,300 ÷ 325

= $4

2. The computation of the fixed cost is shown below:

Fixed cost  = total cost -  Variable cost

                  = $6,500 - (675 × $4)

                  =  $6,500 - $2,700

                  = $3,800

3. And, the total cost for 550 cavities would be equal to

= Fixed cost + variable cost

= $3,800 + (550 cavities × $4)

=  $3,800 + $2,200)

=  $6,000

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McMurphy Corporation produces a part that is used in the manufacture of one of its products. The costs associated with the produ
larisa [96]

Answer:

Opportunity cost ($481,000) is greater than the total production cost ($356,000). McMurphy corporation should produce the products by itself instead of buying from Conners Company since the production costs are lower than purchase cost

Explanation:

Determine the total cost associated with the production of the units as follows;

T=M+L+V+F

where;

T=total costs

M=direct materials cost

L=direct labor costs

V=variable factory overhead costs

F=fixed factory overhead costs

In our case;

M=$88,000

L=$127,000

V=$59,000

F=$137,000

replacing;

T=(88,000+127,000+59,000+137,000)=$411,000

Total costs=$411,000

Assuming the McMurphy avoids 55,000 fixed factory overhead cost;

Total costs=411,000-55,000=$356,000

The opportunity cost if McMurphy Corporation decides to purchase the units from Conners Company instead of producing them will be;

Opportunity cost=cost per unit×number of units

cost per unit=$37

number of units=13,000 units

Opportunity cost=37×13,000=$481,000

Opportunity cost ($481,000) is greater than the total production cost ($356,000). McMurphy corporation should produce the products by itself instead of buying from Conners Company since the production costs are lower than purchase cost

5 0
3 years ago
The following relates to a proposed equipment purchase: Cost $ 157,000 Salvage value $ 5,000 Estimated useful life 4 years Annua
Kruka [31]

Answer:

$14,850

Explanation:

Depreciable amount = $158,000 - $5,000 = $153,000

Annual depreciation = $38,250

Annual net income = $53,100 - $38,250 = $14,850.

Therefore, the annual net income amount used to calculate the accounting rate of return is $14,850

4 0
3 years ago
A _____ is an association of producers that control supply and prices
galina1969 [7]
Piece of cheese bread
6 0
3 years ago
Assuming a speed limit is 105 km/hr, what is this in miles per hour? A. 55.247 mph B. 50.247 mph C. 60.247 mph D. 65.247 mph
Scilla [17]
In the question we are given 105 km/hr
One mile = 1.60934 km
105/1.60934 = 65.244.
Thus, 105 kilometer = 65.24 mile.
The correct option is D.
3 0
3 years ago
Trio company reports the following information for the current year, which is its first year of operation
Arlecino [84]

Explanation:

1. The computation of cost per unit using a absorption costing

Fixed cost

= Fixed manufacturing overhead ÷ Units produced

= $160,000 ÷ 20,000

= $8

Variable costs

Direct material per unit $15

Direct labor per unit $16

Variable manufacturing overhead per unit

= Variable overhead ÷ Units produced

= (80,000 ÷ 20,000)

= $4

Total Variable cost per unit

= $15 + $16 + $4

= $35

Total cost per unit

= $8 + $35

= $43

The computation of cost per unit using a variable costing

Direct material per unit $15

Direct labor per unit $16

Variable manufacturing overhead per unit $4

= $15 + $16 + $4

= $35

2. The computation of ending finished goods inventory using absorption costing

Number of finished goods in units 6,000

Cost of goods in ending inventory

= 6000 × $43

= $258,000

The computation of ending finished goods inventory using variable costing

= Number of finished goods in units 6,000

Cost of goods in ending inventory

= 6,000 × $35

= $210,000

3. The computation of the cost of goods sold using absorption costing

Number of units in sold goods 14,000

Cost of goods sold

= 14,000 × $43

= $602,000

The computation of the cost of goods sold using variable costing

Number of units in sold goods 14,000

Cost of goods sold

= 14,000 × $35

= $490,000

3 0
3 years ago
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