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Dynamic Trainers provides a personalized training program that is popular with many companies

Accounting

Dynamic Trainers provides a personalized training program that is popular with many companies. The number of programs offered over the last five months, and the costs of offering these programs are as follows: 
Programs Offered Costs Incurred 4an 55 $15,900 ei 95 19,050 60 18,000 lApril 50 19,700 75 19,000 

Explain how to compute the variable cost per program and the total fixed cost per month using the high-low method,

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Computation of Variable Cost per Program and Total Fixed Cost per Month using the High-low method:

Variable Cost per Program = (Highest Cost-Lowest Cost)/(Highest Capacity Level - Lowest Capacity Level)

= ($19,000-$14,050)/(75-45)

= $4,950/30

Variable Cost per Program = $165

 

Fixed Cost per Month = Highest Cost - (Highest Capacity Level*Variable Cost per Program)

= $19,000-(75*$165)

= $19,000-$12,375

Fixed Cost per Month = $6,625