Costing/Cost Function - Variable, Fixed & Mixed Cost

Jersey Subs, Inc. wants to find an equation to estimate monthly utility costs. Jersey Subs has been in business for one year and has collected the following cost data for utilities:

(see attached table)

a. Which of the preceding costs is variable? Fixed? Mixed? Explain.

b. Using the high-low method, determine the cost function for each cost.

c. Combine the preceding information to get a monthly utility cost function for Jersey.(What is meant here is to get a total fixed cost for the three utilities and then add the formula for the variable amounts for each utility to get a formula that includes them all. The "function" is just having them all together in one complete formula.)

d. Next month, Jersey Subs expects to use 2,200 kilowatt hours of electricity, make 1,500 minutes of telephone calls, and use 32,000 gallons of water. Estimate total cost of utilities for the month.

2. Bolder Bikes, Inc. manufactures mountain bike frames in Boulder Colorado. In 2012, they produced 24,000 frames at a total cost of $1,296,000. Frames Unlimited, Inc. has offered to supply as many frames as Boulder Bikes wants at a cost of $49.50. Boulder Bikes anticipates needing 26,000 frames each year over the next few years. Boulder Bikes uses historical cost data to come up with the following regression equation with total manufacturing costs of the frame as the dependent variable and frames produced as the independent variable:
y=$545,000 + 21X

During the years used to estimate the regression equation, the production of frames varied from 22,000 to 26,000.

a. Using this equation, estimate how much it would cost Boulder Bikes to manufacture the 26,000 frames.
b. How much more or less costly is it to manufacture the frames rather than to acquire them from Frames Unlimited?

You have been studying 'fixed' costs. You learned that a number of 'fixed' costs are actually mixedcosts (variable and fixed). Write a two paragraph memo to your manager explaining some of the cost estimation techniques that can help determine the fixed and variable portion of each mixedcost (such as utility costs and maintena

* Please look at the attachment!!!!
The following cost items relate to the Brock Company.
Classify each cost as a Vriable cost, a Fixedcost, or a Mixedcost by placing an X in the appropriate column.
Each cost should be evaluated in terms of the volume of units of finished products produced.
Also indica with an X

Fowler Company manufactures a single product. Annual production costs incurred
in the manufacturing process are shown below for two levels of production.
Exercises
Costs Incurred
Production in Units 5,000 10,000
Total Cost/ Total Cost/
Production Costs Cost Unit Cost Unit
Direct materials $8,250 $1.65 $16,500 $1.65
D

You have been studying 'fixed' costs. You learned that a number of 'fixed' costs are actually mixedcosts (variable and fixed). Write a two paragraph memo to your manager explaining some of the cost estimation techniques that can help determine the fixed and variable portion of each mixedcost (such as utility costs and maintena

As EEC's corporate business financial analyst, you will need to have a clear understanding of the different types of costs (variable,fixed, and mixed) that the company carries. Review EEC's journal activity. Define and identify its variable,fixed, and mixedcosts.
Next, determine what affect a sales volume increase or decr

The formula for expressing the total of a fixed, variable, or mixedcost at any level of activity is:
total cost = fixedcost + (variable rate *volume of activity)
total cost = fixedcost *volume of activity
total cost = fixedcost *variable rate
total cost = fixedcost - variable cost

Describe how the high-low method of cost estimation can be used in estimating the fixedcost component of a mixedcost in a business.
Discuss how you would implement activity-based costing for a hospital organization.

Wysocki Company pays its sales force a fixed salary plus a 5% commission on all sales. Explain why sales force costs would be considered a mixedcost. Explain how mixedcosts are related to both fixed and variable costs.