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    Task P 2

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    arisu
    The document analyzes the costs of Redeemer Corporation's machine operations from January to September. It calculates the variable cost per machine hour to be P2.452 based on the costs in March and August. It then determines the monthly fixed cost is P4,027 based on the total and variable costs in March and August matching the total costs. Finally, it estimates that if machine hours were 2,900, the total cost would be P11,137.

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    Task P 2

    Uploaded by

    arisu
    360 views2 pages
    The document analyzes the costs of Redeemer Corporation's machine operations from January to September. It calculates the variable cost per machine hour to be P2.452 based on the costs in March and August. It then determines the monthly fixed cost is P4,027 based on the total and variable costs in March and August matching the total costs. Finally, it estimates that if machine hours were 2,900, the total cost would be P11,137.

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    The document analyzes the costs of Redeemer Corporation's machine operations from January to September. It calculates the variable cost per machine hour to be P2.452 based on the costs in March and August. It then determines the monthly fixed cost is P4,027 based on the total and variable costs in March and August matching the total costs. Finally, it estimates that if machine hours were 2,900, the total cost would be P11,137.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Flag for inappropriate content
    Download as docx, pdf, or txt
    360 views2 pages

    Task P 2

    Uploaded by

    arisu
    The document analyzes the costs of Redeemer Corporation's machine operations from January to September. It calculates the variable cost per machine hour to be P2.452 based on the costs in March and August. It then determines the monthly fixed cost is P4,027 based on the total and variable costs in March and August matching the total costs. Finally, it estimates that if machine hours were 2,900, the total cost would be P11,137.

    Copyright:

    © All Rights Reserved
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    Flag for inappropriate content
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    of 2

    Redeemer Corporation has been reviewing its total costs over the last few months and has

    established
    the following (relevant range is from 2,000 to 5,000):

    Month Machine hours Electricity costs

    January 2,100 P9,750

    February 3,400 14,300

    March 6,800 20,700

    April 4,900 19,550

    May 2,500 11,150

    June 3,000 12,900

    July 2,400 10,800

    August 1,800 8,440

    September 4,800 22,000

    Variable cost per unit

    Variable cost per unit = (P20,700-P8,440)/(6,800-1,800)

    = P12,260/5,000

    = P 2.452

    Total fixed cost

    High Low

    Total Cost P20,700 P8,440

    Less: Total Variable Cost

    P2.452 x 6,800 hours 16,673

    P2.452 x 1,800 hours 4,413

    Monthly fixed cost P4,027 P4,027

    Y = a + bx

    P20,700 = P4,027 + P2.452(6,800)

    = P20,700 = P20,700

    Or
    P8,440 = P4,027 + P2.452(1,800)

    = P8,440 = P8,440

    Total cost assuming Kings, Inc. plans to incur 2,900 machine hours.

    Y = P4,027 + P2.452(2,900)

    = P11,137

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