026. Werner Brothers, Inc., used the high-low method to derive its cost formula for electrical power cost. According to the cost formula, the variable cost per unit of activity is per machine-hour. Total electrical power cost at the high level of activity was $9,400 and at the low level of activity was $9,000. If the high level of activity was 2,200 machine hours, then the low level of activity was: a) 1,800 machine hours b) 1,900 machine hours c) 2,000 machine hours d) 1,700 machine hours 027). When closing overapplied manufacturing overhead to cost of goods sold, which of the following would be true? a) Work in process will decrease. b) Cost of goods sold will increase. c) Net income will decrease d) Gross margin will increase