High-Low Method

John, the cost analyst, went back to the accounting information system to look for more relevant data. The following breakdown of the overhead costs and the associated machine hours over the same 12 month period was available.

Overhead Machine Hours

High - Month July $10,500 500 MH

Low - Month March 8,300 350 MH

Determine the fixed cost function.

Multiple Choice

• $550

• $1,200

• $6,000

• $500

• $5,500