a company reports the following information:\n\nusing the high - low method, the estimated variable cost per…

a company reports the following information:\n\nusing the high - low method, the estimated variable cost per unit is:\n\nmultiple choice\n\n$2.91\n\n$5.10\n\n$2.05\n\n$3.77\n\n$5.37

a company reports the following information:\n\nusing the high - low method, the estimated variable cost per unit is:\n\nmultiple choice\n\n$2.91\n\n$5.10\n\n$2.05\n\n$3.77\n\n$5.37

Answer

Explanation:

Step1: Identify high and low activity levels

High: March (2,780 units, $8,100) Low: April (790 units, $4,030)

Step2: Calculate variable cost per unit

Variable cost per unit = $\frac{\text{Change in cost}}{\text{Change in units}}$ Change in cost = $8,100 - $4,030 = $4,070 Change in units = 2,780 - 790 = 1,990 Variable cost per unit = $\frac{4070}{1990}\approx$2.05

Answer:

$2.05