Assignment:
The following data have been extracted from the records of Riddle Co.:
July December
Production level, in units........................................... 5,000 10,000
Variable Costs......................................................... $12,000 $ ?
Fixed Costs.............................................................. ? 18,000
Mixed Costs............................................................ 10,000 ?
Total Costs.............................................................. $40,000 59,000
Required:
a. Calculate the missing costs.
b. Calculate the cost formula for mixed cost using the high-low method.
c. Calculate the total cost that would be incurred for the production of 8,000 units.
d. Identify the two key costs behavior assumptions made in the calculation of your answer to part c.
Provide complete and step by step solution for the question and show calculations and use formulas.