Question
The electricity costs and machine hours for a period of 6 months are as follows Hours Costs Months machine electricity January 2,000 $ 4,800 February
The electricity costs and machine hours for a period of 6 months are as follows
Hours Costs Months machine electricity January 2,000 $ 4,800 February 2,500 $ 5,200 March 3,000 $ 5,400 April 2,400 $ 5,000 May 2,800 $ 5,600 June 2,200 $ 5,000 Using the high-low method, what is the formula to use to determine electricity costs at different volumes of electricity hours? (Fixed cost + variable cost volume).
a. Electricity costs = $ 2,800 + ($ 1.00 x number of machine hours)
b. Electricity costs = $ 2,600 + ($ 1.00 x number of machine hours)
c. Electricity costs = $ 400 + ($ 1.67 x number of machine hours)
d. Electricity costs = $ 3,600 + ($ .60 x number of machine hours)
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