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Question - The following information pertains to Seven Dwarf Mining Equipment Limited for 2019 and 2020:
Cost of Operating the Purchasing Department
Number of Purchase Orders Issued
Fourth quarter of 2019
$130,000
2,500
First quarter of 2020
80,000
1,000
Second quarter of 2020
110,000
1,500
Third quarter of 2020
115,000
2,000
Fourth quarter of 2020
140,000
3,000
Required - Using the high-low method, determine the following:
1. Determine the variable cost per purchase order.
2. Determine the fixed cost of operating the purchasing department for one quarter.
3. Determine the estimated cost of operating the purchasing department in first quarter of 2021 assuming that 2,800 purchase orders will be issued.
Materials $2215500; Conversion costs $3171300. Find the cost assigned to the units in the ending work in process inventory on April 30
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