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14 November, 18:56

Paige Corporation observed that when 25,000 units were sold, a particular cost amounted to $75,000, or $3.00 per unit. When volume increased by 10%, the cost totaled $82,500 (i. e., $3.00 per unit). The cost that Paige is studying can best be described as a:

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  1. 14 November, 19:23
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    cost that Paige is studying can best be described as variable cost

    Explanation:

    given data

    sold = 25,000 units

    particular cost = $75,000

    per unit = $3

    volume increased = 10%

    cost totaled = $82,500

    per unit = $3

    to find out

    cost that Paige is studying can best be described as

    solution

    here we can say that cost that Paige is studying can best be described as variable cost because as cost changes with change in level of output so that this cost is termed as Variable Cost

    cost change = $82,500 - $75000

    cost change = $7500

    so we can say that cost that Paige is studying can best be described as variable cost
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