Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

A companys electricity cost is a mixed cost - partly fixed and partly variable. If during the month with the largest electricity use the company

A companys electricity cost is a mixed cost - partly fixed and partly variable. If during the month with the largest electricity use the company used 15,000 machine hours and had an electricity cost of $36,000 and during the month with the smallest electricity use the company used 7,000 machine hours and had an electricity cost of $20,000.
1. Its variable cost per machine hour (as determined by the high-low method) would be ____________
2. Its fixed cost per month (as determined by the high-low method using the high numbers) would be _____________________
3. Its fixed cost per month (as determined by the high-low method using the low numbers) would be _____________________
4. Write the equation for estimating the monthly electricity cost.
5. What would you estimate would be the electricity cost for a month when 9,000 machine hours were used?

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Continuous Auditing A Complete Guide

Authors: Gerardus Blokdyk

2019th Edition

0655540318, 978-0655540311

More Books

Students also viewed these Accounting questions