Byrnes Company accumulates the following data concerning a mixed cost, using units produced as the activity level.

Units Produced

Total Cost

March

9,800

$14,740

April

8,500

13,250

May

7,000

11,100

June

7,600

12,000

July

8,100

12,460

(a)Compute the variable- and fixed-cost elements using the high-low method.

(b)Estimate the total cost if the company produces 6,000 units.

Determine the highest and lowest levels of activity.

Compute variable cost per unit as: Change in total costs ÷ (High – low activity level) = Variable cost per unit.

Compute fixed cost as: Total cost – (Variable cost per unit × Units produced) = Fixed cost.