Question Details

How would the cost function be stated




Answer the following questions using the information below: 

Presented below are the production data for the first six months of the year for the mixed costs incurred by Vertise Company.

	Month	Cost	Units
	January	$4,890	4,100
	February	4,426	3,520
	March	6,730	5,200
	April	9,724	8,250
	May	5,900	4,900
	June	7,336	6,600

Vertise Company uses the high-low method to analyze mixed costs.

1) How would the cost function be stated? 
A) y = $484 + $1.12X
B) y = $5,298 + $1.19X 
C) y = $2,388 + $1.12 
D) y = $7,850 + $1.18X 

2) What is the estimated total cost at an operating level of 6,500 units? 
A) $7,752.44 
B) $7,764.00 
C) $7,280.00 
D) $7,661.33 




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