# CH5&CH6 - EXERCISE 5-7 Cost Behavior High-Low Method 1...

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EXERCISE 5-7 Cost Behavior; High-Low Method 1. 105,000 \$0.114 \$11,970.00 70,000 \$0.134 \$9,380.00 35,000 \$0.074 \$2,590.00 at 105,000 km \$7,770.00 =105000*0.074 \$4,200.00 =11970-(0.074*105000) Total Costs \$11,970.00 2. Y=a+bX Y=\$4200+\$0.074X 3. 80,000 \$0.074 \$5,920.00 Kilometer Devices Avg Operating Cost per km Total Annual Cost High level of activity Low level of activity Variable Cost VC Fixed Cost FC

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EXERCISE 5-7 Cost Behavior; High-Low Method 1. Cost of goods sold . . . . . . . . . . . . . . . . . . . . . . . . Variable Advertinsing expense . . . . . . . . . . . . . . . . . . . . . . . . Fixed Shipping expense . . . . . . . . . . . . . . . . . . . . . . . . Mixed Salaries and commissions . . . . . . . . . . . . . . . . . . . . . . . . Mixed Insurance expense . . . . . . . . . . . . . . . . . . . . . . . . Fixed Depreciation expense . . . . . . . . . . . . . . . . . . . . . . . . Fixed 2. Units
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CH5&CH6 - EXERCISE 5-7 Cost Behavior High-Low Method 1...

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