Biology Forums - Study Force

News Month Inc. sells a monthly news magazine. The following information pertains to 2004:
   Number of
   magazines sold   Cost
   First quarter   1,340,000   $1,675,000
   Second quarter   1,750,000   2,194,000
   Third quarter   1,005,000   1,407,000
   Fourth quarter   1,275,000   1,595,000
   Total   5,370,000   $6,871,000

REQUIRED:
Using the high-low method, determine the following:
a.)   The variable cost per magazine.
b.)   The total fixed cost of operating News Month Inc.
c.)   What is the expected cost in the first quarter of 2005 if the number of magazines sold increased 20% over the last quarter of 2004.

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