Vernon Boat Company makes inexpensive aluminum fishing boats.Production is seasonal, with considerable activity occurring in thespring and summer. Sales and production tend to decline in the fall andwinter months. During year 2, the high point in activity occurred in Junewhen it produced 205 boats at a total cost of $163,890. The low pointin production occurred in January when it produced 38 boats at a totalcost of $52,000.Requireda. Use the high-low method to estimate the amount of fixed costincurred each month by Vernon Boat Company.b. Determine the total estimated cost if 110 boats are made.a. Fixed costb. Total estimated cost

The high-low method is used to differentiate the mixed costs. Mixed cost is the combination of fixed…

Answered: Vernon Boat Company makes inexpensive…

Managerial Accounting: The Cornerstone of Business Decision-Making

7th Edition

ISBN:9781337115773

Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Chapter8: Tactical Decision-making And Relevant Analysis

Section: Chapter Questions

Problem 54P

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