The following data pertains to activity and costs for two months:
Assuming that these activity levels are within the relevant range, the mixed cost for July was:
$10,000 $35,000 $15,000 $40,000 Variable cost per unit = $20,000 ÷ 10,000 units = $2 per unit Total variable cost in July = $2 per unit × 20,000 units = $40,000 per unit Fixed cost = $15,000 (given) Total cost = Variable cost + Fixed cost + Mixed cost $70,000 = $40,000 + $15,000 + Mixed cost Mixed cost = $70,000 - ($40,000 + $15,000) $70,000 - $55,000 $15,000
AACSB: Analytic AICPA BB: Critical Thinking AICPA FN: Measuremen Blooms: Apply Learning Objective: 02-03 Understand cost behavior patterns including variable costs; fixed costs; and mixed costs. Level: 3 Hard
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