Gargymal Company would like to estimate the variable and fixed components of its electrical costs and has compiled the following data for the last five
Gargymal Company would like to estimate the variable and fixed components of its electrical costs and has compiled the following data for the last five months of operations.
| Machine Hours | Electrical Cost | |
| August | 1,000 | $1,550 |
| September | 900 | 1,510 |
| October | 1,500 | 1,750 |
| November | 2,000 | 1,950 |
| December | 1,300 | 1,670 |
Using the high-low method of analysis, the estimated variable cost per machine hour for electricity is closest to?
Step by Step Solution
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Variable cost Change in cost Change in activity 1950 1510 2000 900 040 Fixed cost element ...
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Authors: Douglas Lind, William Marchal
16th Edition
78020522, 978-0078020520
