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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 1,200 machine hours, with the following data being available for the first six months of the year:
Month | Utilities | Machine Hours | |||||
January | $ | 9,500 | 880 | ||||
February | 9,160 | 800 | |||||
March | 9,750 | 890 | |||||
April | 10,160 | 1,000 | |||||
May | 10,609 | 1,030 | |||||
June | 9,950 | 980 | |||||
The fixed utilities cost per month for Barkoff is:
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