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Cost behavior when costs are semi variable. Data from the payroll department of Dominguez Company for the past two months follow:

Number of Payroll

Number of Employees Paid Payroll Department Costs

November............................................................. 6,000 $12,000
December............................................................. 9,000 15,000

a. Sketch a line describing these costs as a function of the number of employees paid.

b. What is the apparent variable cost per employee paid?

c. The line should indicate that these costs are semi variable. What is the apparent fixed cost per month of running the payroll department during November and December?

Accounting Basics, Accounting

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