A department of Alpha Co. incurred the following costs for 1…
A department of Alpha Co. incurred the following costs for the month of September. Variable costs, and the variable portion of mixed costs, are a function of the number of units of activity:Activity level in units . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,000Variable costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $10,000Fixed costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30,000Mixed costs. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20,000Total costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $60,000During October the activity level was 8,000 units, and the total costs incurred were $70,500.Required:a. Calculate the variable costs, fixed costs, and mixed costs incurred during October.b. Use the high–low method to calculate the cost formula for mixed cost.
