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Q1) Using high-low method, compute the variable cost per unit?

The Nelson Company experienced the following costs in 2007:

Direct materials $2.25/unit
Direct labor $4.10/unit
Variable manufacturing overhead $.75/unit
Variable selling $3.00/unit
Fixed manufacturing overhead $60,000
Fixed selling $35,000
Fixed administrative $20,000

Q2) Company has offer from wholesaler to buy part for $31 per unit.  If company decides to accept offer cost for this part will increase or decrease by__ per unit?

Accounting Basics, Accounting

  • Category:- Accounting Basics
  • Reference No.:- M919136

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