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Maintenance Costs are $25,000 when 100,000 units are sold, and $55,000 when 300,000 units are sold. If we used the high-low method to calculate the variable costs to be $0.15, what is the fixed portion of the maintenance costs? $5,000 $20,000 $15,000 $10,000
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Question & Answer: Maintenance Costs are $25,000 when 100,000 units are sold, and $55,000 when 300,000 units are sol…..
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Fixed proportion would be=Total cost -(Variable cost/unit*Number of units sold)
which is equal to
=$55000-($0.15*300,000)
=$10,000(D).
