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High - Low Method. Gaines Company produces smartphones. Management wants to estimate the cost of production equipment used to produce smartphones. The company reported the
HighLow Method. Gaines Company produces smartphones. Management wants to estimate the cost of production equipment used to produce smartphones. The company reported the following monthly cost data related to production equipment: HighLow Method. Gaines Company produces smartphones. Management wants to estimate the cost of production equipment used to produce smartphones. The company reported the following monthly cost data related to production equipment: tableReporting Period MonthTotal Costs,Machine HoursJanuary$FebruaryMarchAprilMayJuneJulyAugustSeptemberOctoberNovemberDecemberReq Required: a Use the four steps of the highlow method to estimate the total fixed cost per month and the variable cost per machine hour. State your results in the cost equation form by filling in the dollar amounts for and b What would the company's estimated costs be if it used machine hours next month? c What would the company's estimated costs be if it used machine hours next month? Why might you feel uncomfortable estimating costs for machine hours? Reporting Period Month Total Costs Machine Hours January $ February March April May June July August September October November December Required: Use the four steps of the highlow method to estimate the total fixed cost per month and the variable cost per machine hour. State your results in the cost equation form Y f vX by filling in the dollar amounts for f and v What would the companys estimated costs be if it used machine hours next month? What would the companys estimated costs be if it used machine hours next month? Why might you feel uncomfortable estimating costs for machine hours?
HighLow Method. Gaines Company produces smartphones. Management wants to estimate the cost of production equipment used to produce smartphones. The company reported the following monthly cost data related to production equipment: HighLow Method. Gaines Company produces smartphones. Management wants to estimate the cost of production equipment used to produce smartphones. The company reported the following monthly cost data related to production equipment:
tableReporting Period MonthTotal Costs,Machine HoursJanuary$FebruaryMarchAprilMayJuneJulyAugustSeptemberOctoberNovemberDecemberReq
Required:
a Use the four steps of the highlow method to estimate the total fixed cost per month and the variable cost per machine hour. State your results in the cost equation form by filling in the dollar amounts for and
b What would the company's estimated costs be if it used machine hours next month?
c What would the company's estimated costs be if it used machine hours next month? Why might you feel uncomfortable estimating costs for machine hours?
Reporting Period Month Total Costs Machine Hours
January $
February
March
April
May
June
July
August
September
October
November
December
Required:
Use the four steps of the highlow method to estimate the total fixed cost per month and the variable cost per machine hour. State your results in the cost equation form Y f vX by filling in the dollar amounts for f and v
What would the companys estimated costs be if it used machine hours next month?
What would the companys estimated costs be if it used machine hours next month? Why might you feel uncomfortable estimating costs for machine hours?
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