Why Choose Us?
0% AI Guarantee
Human-written only.
24/7 Support
Anytime, anywhere.
Plagiarism Free
100% Original.
Expert Tutors
Masters & PhDs.
100% Confidential
Your privacy matters.
On-Time Delivery
Never miss a deadline.
Bryson Co
Bryson Co. estimates its power usage for July at 700 watts. What is the total power cost for July? Peabo Bryson Co. has the following data relating to its power usage for the first six months of the current year. Month Jan. Feb. Mar. Apr. May June Usage (kw) 500 550 475 425 450 725 Cost P4,500 4,550 3,950 3,100 3,800 4,840 Assume usage is within the relevant range of activity.
Expert Solution
1.Semi variable cost per unit=Change in cost/change in units=(4840-3800)÷(725-450)=3.78 per unit
Fixed cost =4840-(3.78*725)=2,100
Computation of variable cost per unit for the given semi variable cost :
Variable costs =[Highest Activity cost - lowest activity cost] ÷ [Highest activity Kw-lowest activity Kw ]
Variable costs per Kw=[4,840-3,100] ÷ [725 -425 ]=1,740 ÷300=5.8 per unit.
Fixed costs=Highest activity cost-(Variable cost per Kw *highest activity Kw)
4,840 -(5.8 per Kw *725 Kw) =635
or
=Lowest activity cost-(Variable cost per Kw*lowest activity Kw)
3,100-(5.8 per Kw *425 Kw)=635.
2.Computation of total power cost for the month of July
| Particulars | Amount |
| Power usage | 700 watts |
| Variable cost | (700*5.8 per Kw)=4060 |
| Fixed Cost | 635 |
| Total Cost (Fixed + variable) |
4,695 (4,060+635) |
Archived Solution
You have full access to this solution. To save a copy with all formatting and attachments, use the button below.
For ready-to-submit work, please order a fresh solution below.
