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The following information is available for a company's cost of sales over the last four months. Month Units Sold Total Cost January 400 $ 31,000 February 800 $ 37,000 March 1,600 $ 49,000 April 2,400 $ 61,000 Using the high-low method, the estimated total fixed cost is:

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$25,000 is the total fixed cost of the company by high-low method. as d Total Cost January 400 $.

Explanation

The computation of the estimated total fixed cost is shown below:

But before that the variable cost per unit is

= ($61,000 - $31,000) ÷ (2,400 - 400)

= $30,000 ÷ 2,000

= $15

Now the estimated fixed cost is

= $61,000 - $15 × 2,400

= $61,000 - $36,000

= $25,000

Thus, is the $25,000, total-fixed cost.

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