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Hello, I need help with how to solve the question below: uses the high-low method to analyze cost behavior. You as controller have determined that

Hello, I need help with how to solve the question below:

  1. uses the high-low method to analyze cost behavior. You as controller have 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

  1. Determine the cost equation.
  2. What is the variable cost per unit?
  3. What are the total fixed costs?
  4. If there are 980 machine hours, what will utility costs be projected to be?

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