Ask Question
5 April, 18:12

During a year, Teri's monthly sales compensation ranged between $22,000 and $30,000 per month and units sold ranged between 1,400 and 2,200 units for those same months. Required: Use the high-low method to determine Teri's monthly salary and commission rate per unit sold and then calculate the total number of units sold in a year when Teri's total compensation amounted to $291,000. (Round your "Commission rate" to 2 decimal places.)

+3
Answers (1)
  1. 5 April, 20:14
    0
    8,000 = fixed cost

    10 unit cost

    Explanation:

    High low method calcualtes the difference to get the variable cost:

    2,200 units generated 30,000 (fixed + variable)

    minus

    1,400 units generated 22,000 (fixed + variable)

    800 8,000 variable

    800 units generated $8,000 of cost

    $8,000 / 800 untis = 10 unit cost

    Now we solve for fixed cost

    total cost = fixed cost + variable cost

    total cost = fixed cost + quantity x variable unit cost

    30,000 = fixed + 2,200 x 10

    30,000 = fixed + 22,000

    30,000 - 22,000 = fixed

    8,000 = fixed cost
Know the Answer?
Not Sure About the Answer?
Get an answer to your question ✅ “During a year, Teri's monthly sales compensation ranged between $22,000 and $30,000 per month and units sold ranged between 1,400 and 2,200 ...” in 📙 Business if there is no answer or all answers are wrong, use a search bar and try to find the answer among similar questions.
Search for Other Answers