Question
X Corp uses the high-low method to analyze cost behavior. The company observed that at 22,000 machine hours of activity, total maintenance costs averaged P8.00
X Corp uses the high-low method to analyze cost behavior. The company observed that at 22,000 machine hours of activity, total maintenance costs averaged P8.00 per hour. When activity jumped to 30,000 machine hours, which was still within the relevant range, the average cost per machine hour totaled P7. On the basis of this information, the variable cost per machine hour was: P4.00, P4.25, P7.50, P7.42
X Corp uses the high-low method to analyze cost behavior. The company observed that at 10,000 machine hours of activity, total maintenance costs averaged P10.00 per hour. When activity jumped to 15,000 machine hours, which was still within the relevant range, the average cost per machine hour totaled P8.50. On the basis of this information, if X Corp plans to incur 13,000 machine hours, the total cost would be: P116,500, P127,750, P118,300, P120,250
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