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Unformatted text preview: her the step-function costs and the fixed costs to give us the total applicable fixed costs. We then could use the formula as described above. Unfortunately, the process is not quite that simple, as the following example illustrates. ____________________________________________________________________________________________________________ David W. Young • Management Accounting for Managers • Chapter 2 Page 33 Copyrighted Material. Do not reproduce without written permission. ••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••• Problem: Return to the first problem for Littleton news (i.e., ignore the electricity costs). In addition to the $100,000 in fixed costs stipulated in the...
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