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  3. 2. xyz ltd is estimating its costs on past informa

2. XYZ Ltd is estimating its costs on past information. The total costs incurred by...

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Accounting

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2. XYZ Ltd is estimating its costs on past information. The total costs incurred by the company at different levels of output were as follows: Output (units) 160.000 185,000 190,000 Total costs () 2,420,000 2,775,000 2,840,000 The company uses the high-low method to separate total costs into their fixed and variable elements. Ignore inflation Required: Show your workings for all parts. a. Calculate the estimated total costs for an output of 205,000 units. Ensure you show the variable cost per unit. (9 marks) b. The company has now established that there is a stepped increase in fixed costs of 30,000 when output reaches 180,000 units. Calculate the estimated total costs for an output of 175,000 units using this additional information. Ensure you show the new variable cost per unit for this output level

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