Utility cost for operating

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Use the following information to determine the break-even point in units (rounded to the nearest whole unit):

Unit sales

50,000

Units

Unit selling price

$14.50

 

Unit variable cost

$7.50

 

Fixed costs

$186,000

 

12,828

26,571

8,455

46,667

24,800

The following information is available for a company's utility cost for operating its machines over the last four months.

Month

Machine hours

Utility cost

January

900

$5,450

February

1,800

$6,900

March

2,400

$8,100

April

600

$3,600


Using the high-low method, the estimated variable cost per unit for utilities is:

a. $3.38

b. $6.00

c. $2.50

d. $4.22

e. $6.17

Reference no: EM13913700

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