Being smart and being decisive.
Answer:
Variable cost per unit= $1.16 per mile
Explanation:
Giving the following information:
January 16,200 $22,650
February 17000 $23,250
March 18400 $25,450
Apri 16500 $22,875
May 17400 $23,550
June 15300 $21,850
<u>To calculate the variable cost per mile under the high-low method, we need to use the following formula:</u>
Variable cost per unit= (Highest activity cost - Lowest activity cost)/ (Highest activity units - Lowest activity units)
Variable cost per unit= (25,450 - 21,850) / (18,400 - 15,300)
Variable cost per unit= $1.16 per mile
Answer:
the relevant cost to make is $44.35
Explanation:
given data
Direct material = $ 8.10
Direct labor = 24.10
Overhead = 40.50
Total product cost per unit = $ 72.70
Cost of purchase = $42.35
solution
we know here that 70% of overhead cost is unavoidable
so we can say that it will not be considered for decision making
so here Cost of manufacturing will be
Cost of manufacturing = $8.10 + $24.10 + ( 30% of $40.50 )
Cost of manufacturing = $44.35
and
Cost of purchase is = $42.35
so here we can say the relevant cost to make is $44.35
The firm's degree of operating leverage is 1.23. Operating leverage is the measure of the degree to which a firm or project incurs a combination of fixed and variable costs. Businesses have more leverage when they have more sales resulting in a high gross merger and less fixed and variable costs.
To solve: Change in EBIT percent / change in sales percent
