sorry Sir
It's me again. I have my Cbe in less than 1 week and fell like not ready.
another question please:
You are going through the cost information of one of the production facility of the company which is as follows:
Machine hours Total cost
32,000 515,000
35,000 530,600
41,000 570,000
Variable cost per unit remains unchanged from activity level of 30,000 -40,000 and then from 40,001 to 45,000.
What is the total cost if machine runs for 42,500 hours provided:
-the fixed cost steps up by 10% if machine hours exceed 36,000 hours
-the fixed cost steps down by 10% if machine hours exceed 36,000 hours
Ask the Tutor ACCA MA
high low method
I do not know where you found this question, but as it reads it is not possible.
Either you have mistyped one of the two higher activity levels/costs; or the wording of the English in the question is appalling; or it is simply impossible.
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