Question

Harry's seafood used high-low data from june and july to determine its variable cost of $15 per unit. Additional information follows: month units produced total costs june 2,000 $40,000 july 1,000 25,000 if harry's produces 2,300 units in august, how much is its total cost expected to be?

Answer 1

Answer:

$ 44500

Step-by-step explanation:

Month    Units        Cost

June       2000        $40000

July         1000         $25000

August    2300

Let say per unit cost  = x

Fixed cost  = c

40000 = 2000x   + c

25000 = 1000x + c

=> 15000 = 1000x

=> x = 15

=> c = 10000

when 2300 units produces

total cost expected to be = 2300*15 + 10000

= $ 44500