DubboLtd has accumulated the following data for the most recent 6-month period. Maintenance services have been determined to be a mixed cost.

Month

Direct labour hours

Maintenance services

July

30,000

$45,000

August

18,000

28,000

September

21,000

40,000

October

4,000

17,000

November

12,000

20,000

December

9,000

20,000

Management believes that maintenance cost is a mixed cost that depends on direct labour hours. Using the high-low method to estimate the variable component of this cost, the estimate would be closest to:

Select one:

a.$0.93 per direct labour hour

b.$1.10 per direct labour hour

c.$1.08 per direct labour hour

d.$0.95 per direct labour hour