Ch 2. Ques 1

Thornton Computer Services, Inc. has been in business for six months. The following are basic operating data for that period:

	Month
	July			Aug.			Sept.			Oct.			Nov.			Dec.
Service hours		120			136			260			420			320			330
Revenue	$	6,000		$	6,800		$	13,000		$	21,000		$	16,000		$	16,500
Operating costs	$	4,300		$	5,300		$	7,100		$	11,200		$	9,100		$	10,600

Required

1. What is the average service revenue per hour in each month and the overall average for the six-month period?

2. Use the high-low method to estimate the total monthly fixed cost and the variable cost per hour.

3. Determine the average contribution margin per hour.