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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 | $ | 10,500 | 980 | ||||
February | 10,160 | 900 | |||||
March | 10,750 | 990 | |||||
April | 11,160 | 1,100 | |||||
May | 11,241 | 1,130 | |||||
June | 10,950 | 1,080 | |||||
The variable utilities cost per machine hour for Barkoff is:
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