Chen Corp Uses the High-Low Method to Estimate How Its Costs

question 118

Multiple Choice

Chen Corp. uses the high-low method to estimate how its costs vary with levels of production. For the year, its high production was 50,000 units in a day, at a cost of $900,000, and its low production was 30,000 units, at a cost of $600,000. Its variable cost per unit is

• A) Zero
• B) 10
• C) 15
• D) 20

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Definitions:

Occurrence of Volcanoes

The event of volcanic activity or eruption in a specific location.

Rock Cycle

The continuous process by which rocks are formed, broken down, and transformed into new rock types, driven by forces within the Earth and on its surface.

Rock Metamorphism

The process by which the mineral composition and structure of a rock is changed by heat and pressure over time.

Subsurface Mining

Extraction of minerals and resources from below Earth's surface, involving techniques that may harm the environment through alteration of land structure and pollution.