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Ch 5 Hmwk Sol

# Ch 5 Hmwk Sol - ACC 202 Ch 5 Homework Solutions Exercise...

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ACC 202  Ch 5 Homework Solutions Exercise 5-1   1. Cups of Coffee Served  in a Week 1,800 1,900 2,000 Fixed cost \$1,100 \$1,100 \$1,100 Variable cost         468             494             520     Total cost \$1,568 \$1,594 \$1,620 Cost per cup of coffee served * \$0.871 \$0.839 \$0.810 * Total cost  ÷  cups of coffee served in a week 2. The average cost of a cup of coffee declines as the number of  cups of coffee served increases because the fixed cost is spread  over more cups of coffee.

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Exercise 5-10  1. X-rays Taken X-ray Costs High activity level (February) ......... 7,000 \$29,000 Low activity level (June) ................. 3,000   17,000     Change .......................................... 4,000 \$12,000 Variable cost per X-ray: Change in cost \$12,000 = = \$3.00 per X-ray Change in activity 4,000 X-rays Fixed cost per month: X-ray cost at the high activity level ........................... \$29,000 Less variable cost element: 7,000 X-rays  ×  \$3.00 per X-ray ..............................   21,000     Total fixed cost ......................................................... \$      8,000     The cost formula is \$8,000 per month plus \$3.00 per X-ray taken  or, in terms of the equation for a straight line: Y = \$8,000 + \$3.00X where X is the number of X-rays taken. 2. Expected X-ray costs when 4,600 X-rays are taken: Variable cost: 4,600 X-rays  ×  \$3.00 per X-ray ............. \$13,800 Fixed cost ....................................................................       8,000     Total cost ..................................................................... \$21,800
Exercise 5-11 1. The scattergraph appears below.

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0 2,000 4,000 6,000 8,000 10,000 12,000 14,000 16,000 18,000 20,000 22,000 24,000 26,000 28,000 30,000 32,000 0 1,000 2,000
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