Reference no: EM132581506

Consumer Centered Manufacturers Ltd produces a finished product that is measured in metres. The following table gives information that relates metres of production to total costs:

Output/metres              Total Costs $

290                                  10,600

440                                  15,100

390                                  13,600

570                                  19,000

330                                   11,800

270                                   10,000

510                                  17,200

Required:

Use the High/low method of cost separation to do the following:

Question (a) Determine the variable cost per metre of production.

Question (b) Determine the amount of fixed costs involved in production.

Question (c) Develop an equation that relates output to total costs.