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Q14: The following data pertains to activity and maintenance costs for two recent years: Year 1: Activity level (6,000 units), Maintenance cost ($4,200) Year 2:
Q14:
The following data pertains to activity and maintenance costs for two recent years:
Year 1: Activity level (6,000 units), Maintenance cost ($4,200)
Year 2: Activity level (11,125 units), Maintenance cost $6,250)
If the high-low method is used to separate fixed and variable components of the cost, which of the following statements is correct?
a.
The variable cost is $0.70 per unit of activity
b.
The variable cost is $2.50 per unit of activity
c.
The fixed cost is $2,050
d.
The fixed cost is $1,800
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