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The controller of Carla Vista Production has collected the following monthly expense data for analyzing the cost behavior of electricity costs. Total Electricity Costs Total

The controller of Carla Vista Production has collected the following monthly expense data for analyzing the cost behavior of electricity costs.

Total Electricity Costs

Total Machine Hours

January

$2,450 270

February

3,100 320

March

3,570 450

April

4,700 685

May

3,240 400

June

4,870 800

July

4,120 650

August

3,950 580

September

5,020 670

October

4,260 630

November

3,250 320

December

6,300 820

(a)

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Determine the fixed- and variable-cost components using the high-low method.

Fixed-costs

$enter the fixed cost amount in dollars

Variable-costs

$enter the variable cost amount in dollars

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(b)

What electricity cost does the cost equation estimate for a level of activity of 450 machine hours?

Electricity costs $enter the electricity cost amount in dollars

By what amount does this differ from Marchs observed cost for 450 machine hours?

Amount differ $enter the difference cost amount in dollars

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(c)

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