Meyer Company, which uses the high-low method to analyze cost behavior, has determined that machine hours best predict the companys total utilities cost. The companys cost and machine hour usage data for the first six months of the year follow:

Month

Total Cost

Machine Hours

January

$3,450

1,020

February

$3,720

1,110

March

$3,467

1,010

April

$3,730

1,270

May

$4,900

1,320

June

$4,232

1,460

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.IfMeyerCompanyuses1,280machinehoursinamonth,whatwillitstotalcostsbe?