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Hot'lanta, Inc., which uses the high-low method to analyze cost behavior, has determined that machine hours best explain the company's utilities cost. The company's relevant
Hot'lanta, Inc., which uses the high-low method to analyze cost behavior, has 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 | $8,900 | 820 |
February | 8,560 | 740 |
March | 9,150 | 830 |
April | 9,560 | 940 |
May | 9,871 | 970 |
June | 9,350 | 920 |
The fixed utilities cost per month is:
$3,706.
$4,342.
an amount other than those listed above.
$5,042.
$4,702.
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