MAplease answer this question with workings

What is the requirement of the question? What is the $220,000?

Requirement: what is the total cost at an activity level of 10,000 units. And $ 220,000 is the answer of this question

As u know that vcost increases as no of units increases so we can find the vcost per unit by taking the increase in units from 12000 to 15000 units which is 3000 units we take the increase in cost between these two levels which is 24000 after dividing increase in cost by increase in units we get a vcost per unit of 8 we use 12000 and 15000 because both levels will have that extra 10% fixed cost added so both are comparable after getting vcost per unit of 8 we can multiply this with our activity level of 8000 and we can calculate fixed cost of 140000 Now u know the fcost too so multiply 8 with ur req activity level of 10000 which equals $80000 and add fcost of $140000 to get total cost $220000 which is the correct answer as well :) Hope this is helpful

hiii can i know how you get the 140000?? thanksss :D

Read my post above urs It has the full detail

arsalanullah is correct, although you do not actually need to calculate the fixed costs. You can calculate the variable cost per unit (as arsanullah has done) at $8 per unit. We know the total cost for 8,000 is $204,000 from the question, and the only difference for 10,000 will be the extra variable cost of an extra 2,000 units (because the fixed cost will be the same for 8,000 and for 10,000 units). So the extra cost is 2,000 x $8 = $16,000. So the total cost is $204,000 + $16,000 = $220,000

Thank you John - you are great God bless you.

No problem. You are welcome :-)

I tried doing it with high-low method, didn't get the right answer.

The explanation is above, but if you need more help then please ask in the Ask the Tutor - this forum is for students to help each other. I do assume that you have watched my free lectures?