Homework SourseExecutive Training Inc provides a personal development semin
Executive Training, Inc. provides a personal development seminar that is popular with many companies. Executive Training charges $500 for each seminar it conducts. The number of seminars offered over the last six months along with the total costs of offering these seminars appear below: Month Costs Incurred Seminars Offered January $15,400 55 February 14,200 45 March 18,000 60 April 14,700 50 May 19,600 75 June 16,500 58 Executive Training, Inc. expects to offer 72 seminars during July. Using the high-low method, calculate Executive Training\'s expected net income for July.
Solution
using high low method;variable cost/seminar=(Total cost at highest level-total cost at lowest level)/(Highest level-Lowest level)
=(19600-14200)/(75-45)=$180
Total fixed costs=19600-(180*75)=$6100
| Service revenue(500*72) | 36000 |
| Less:Variable costs(180*72) | 12960 |
| Less:Fixed costs | 6100 |
| Expected net income | $16940. |
