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Barkoff Enterprises, which uses the high-low method to analyze cost behavior, has determined that machine hours best explain the company's utilities cost. The company's relevant
Barkoff Enterprises, which uses the high-low method to analyze cost behavior, has determined that machine hours best explain the company's utilities cost. The company's relevant range of activity varies from a low of 600 machine hours to a high of 1,100 machine hours, with the following data being available for the first six months of the year:
Month | Utilities | Machine Hours | |||||
January | $ | 8,700 | 800 | ||||
February | 8,360 | 720 | |||||
March | 8,950 | 810 | |||||
April | 9,360 | 920 | |||||
May | 9,625 | 950 | |||||
June | 9,150 | 900 | |||||
The fixed utilities cost per month for Barkoff is:
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