Question
Swan, Inc. uses the high-low method to analyze cost behavior. The company observed that at 20,000 machine hours of activity, total maintenance costs averaged $34.30
Swan, Inc. uses the high-low method to analyze cost behavior. The company observed that at 20,000 machine hours of activity, total maintenance costs averaged $34.30 per hour. When activity jumped to 27,000 machine hours, which was still within the relevant range, the average total cost per machine hour was $27.30.
On the basis of this information, the variable cost per machine hour for Swan was:
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Managerial Accounting An Integrative Approach
Authors: C J Mcnair Connoly, Kenneth Merchant
2nd Edition
099950049X, 978-0999500491
