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I know this is pretty basic i just need a reminder before my final. If someone can walk me through it. Thanks. Battle Company, which
I know this is pretty basic i just need a reminder before my final. If someone can walk me through it. Thanks.
Battle Company, which uses the high-low method to analyze cost behavior, has determined that machine hours best predict the company's total utilities cost. The company's cost and machine hour usage data for the first six months of the year follow: (Click the icon to view the data.) i Data Table Requirements Using the high-low method, answer the following questions: 1. What is the variable utilities cost per machine hour? 2. What is the fixed cost of utilities each month? 3. If Battle Company uses 1,270 machine hours in a month, what will its total costs be? Machine Hours Requirement 1. What is the variable utilities cost per machine hour? 1,090 1,170 Let's begin by determining the formula that is used to calculate the variable cost (slope). Change in volume = Variable cost (slope) Month January ...... $ February .....$ March .......$ April .........$ May .......... $ June ........$ Total Cost 3,460 3,790 3,574 3,790 4,600 4,294 1,030 1,250 (Round the variable cost to the nearest cent.) 1,320 Using the high-low method, the variable utilities cost per machine hour is $ 1.80 1,430 Requirement 2. What is the fixed cost of utilities each month? Let's begin by determining the formula that is used to calculate the fixed cost component. Total utilities cost ". Total variable cost = Fixed cost Print Done Done Using the high-low method, the fixed cost of utilities each month is $ 1,720 Requirement 3. If Battle Company uses 1,270 machine hours in a month, what will its total costs be? (Round the variable cost per unit to two decimal places and round your total costs calculation to the nearest whole dollar.) The total costs when 1,270 machine hours are used is $ 4,006Step by Step Solution
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