Question
1) The following information is available for a company's maintenance cost over the last seven months. Using the high-low method, estimate both the fixed
1) The following information is available for a company's maintenance cost over the last seven months. Using the high-low method, estimate both the fixed cost per month and variable cost per unit for maintenance cost. Maintenance Hours Maintenance Cost Month June 18 $ 5 450 July 36 6 900 August 24 5 100 September 30 6 000 October 42 6 900 November 48 8 100 December 12 3 600 2) Which one of the following is an assumption that underlies CVP analysis? 1- For costs classified as variable, the costs per unit of output must change constantly. 2- For costs classified as fixed, the costs per unit of output must remain constant. 3- All costs behave predictably within the relevant range. 4- The selling price per unit must change in proportion to the number of units sold.
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