Shatner Inc .has decided to use the high-low method to estimate the total cost and the fixed and variable cost components of the total cost. The data for various levels of production are as follows:
Units Produced 7,500 Total Cost $600,000
12,500 $ 725,000
20,000 $ 800,000
A. Determine the variable cost per unit and the fixed cost.
B. Based on part (a) estimate the total cost for 10,000 units of production.