Question:
Using the high-low method, seperate each mixed expense into variable and fixed elements. State the cost formula for each mixed expense.
July August September
Sales in units 4,000 4,500 5,000
Sales revenue A$400,000 A$450,000 A$500,000
Less cost of goods sold 240,000 270,000 300,000
Gross Margin: 160,000 180,000 200,000
Less operating expenses:
Advertising expense 21,000 21,000 21,000
Shipping expense 34,000 36,000 38,000
Salary and commisions 78,000 84,000 90,000
Insurance expense 6,000 6,000 6,000
Depreciation expense 15,000 15,000 15,000
Total operating expense 154,000 162,000 170,000
Operating income A$6,000 A$18,000 A$30,000
Help would be appreciated. Points would be awarded for the best ans
2007-09-27
08:52:27
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2 answers
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asked by
Nathe C
1