Question
Swan, Inc. uses the high-low method to analyze cost behavior. The company observed that at 19,000 machine hours of activity, total maintenance costs averaged $37.50
Swan, Inc. uses the high-low method to analyze cost behavior. The company observed that at 19,000 machine hours of activity, total maintenance costs averaged $37.50 per hour. When activity jumped to 25,000 machine hours, which was still within the relevant range, the average total cost per machine hour was $30.30.
On the basis of this information, the fixed cost for Swan was:
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Managerial Accounting An Integrative Approach
Authors: C J Mcnair Connoly, Kenneth Merchant
2nd Edition
099950049X, 978-0999500491
