Milden Company has an exclusive franchise to purchase a product from the manufacturer and distribute it on the retail level. As an aid in planning, the company has decided to start using a contribution format income statement. To have data to prepare such a statement, the company has analyzed its expenses and has developed the following cost formulas: Cost Cost Formula Cost of good sold $24 per unit sold Advertising expense $174,000 per quarter Sales commissions 8% of sales Shipping expense ? Administrative salaries $84,000 per quarter Insurance expense $9,400 per quarter Depreciation expense $54,000 per quarter Management has concluded that shipping expense is a mixed cost, containing both variable and fixed cost elements. Units sold and the related shipping expense over the last eight quarters follow: Quarter Units Sold Shipping Expense Year 1: First 20,000 $ 164,000 Second 22,000 $ 179,000 Third 27,000 $ 221,000 Fourth 23,000 $ 184,000 Year 2: First 21,000 $ 174,000 Second 24,000 $ 189,000 Third 38,000 $ 236,000 Fourth 35,000 $ 212,000 Milden Company’s president would like a cost formula derived for shipping expense so that a budgeted contribution format income statement can be prepared for the next quarter. Required: 1. Using the high-low method, estimate a cost formula for shipping expense based on the data for the last eight quarters above.
Do You Need A Similar Assignment Done For You From Scratch? We Have Qualified Writers To Help You. We Assure You An A+ Quality Paper That Is Free From Plagiarism. Order Now For An Amazing Discount!
Very professional support! Highly recommended.
Researched complicated topic and delivered report by the requested deadline. The paper is of a high standard reflecting careful research and clear assessments. I recommend iLecturers.com.com
It’s a 5 start for me. Excellent research and writing. The paper reflects a careful assessment of scientific information.
With Gib’s reflection, they wrote a really specific essay. Very well written, containing all of the languages I required and excellent references. The writer follows my instructions and writes clearly in English.
I am so grateful and I am 100% happy with your work.
A fantastic piece of work 👏. The writer demonstrated full knowledge of the topic and applying the relevant provided material. Well done.