The local utility company charges ABC Company at a mixed cost utility rate: an annual fee plus a variable cost for each kilowatt of power the company uses. Utility usage and costs are as follows: Kilowatts 187,976 219,764 196,644 143,987 156,983 115,300 156,392 125,982 151,999 170,637 294,000 184,763 Utility Costs $135,500 170,000 160,000 114,000 128,000 89,000 108,000 98,000 88,000 140,000 165,000 144,000

The local utility company charges ABC Company at a mixed cost utility rate: an annual fee plus a variable cost for each kilowatt of power the company uses. Utility usage and costs are as follows: 2 a. Use the high-low method to determine the cost flow equation for ABC s utility costs. Show your work. b. It takes approximately 8,000 kilowatt hours of electricity for ABC company to make one unit of product. ABC expects to make 25 units of product in 2014. Using the high low method, predict the total utility costs at the projected level of usage for 2014. Show your work (show the total cost equation)