@shannLam We take the highest and lowest outputs (i.e. units produced) and the costs related to those outputs. In the example, highest output is 22,080 , lowest output is 19,200 so we take the related $960,000 and $885,120, respectively.
highest output – lowest output / cost of highest output – cost of lowest output = cost/unit
Could you please give me the solution for this one:
The fixed costs have increased from $ 40,000 to $ 120,000 and the variable cost increased from $12 per unit to $22 per unit. Then what would be the number of units?
Hi Sir,
Can you say why for question #3 we used $885,120 (units 19,200) instead of 883,200 (20,160 units) ?
@shannLam
We take the highest and lowest outputs (i.e. units produced) and the costs related to those outputs.
In the example, highest output is 22,080 , lowest output is 19,200 so we take the related $960,000 and $885,120, respectively.
highest output – lowest output / cost of highest output – cost of lowest output = cost/unit
@ Kriszemrich Thank you for your assistance.
where did you get^3 from question 2. please can someone explain the question.Thank you
Making another 7 means that they are making 8 in total. Making 8 involves doubling 3 times.
Have you watched the free lectures on this?
June 2023 PM exam question:
Hi Sir,
Could you please give me the solution for this one:
The fixed costs have increased from $ 40,000 to $ 120,000 and the variable cost increased from $12 per unit to $22 per unit. Then what would be the number of units?