Answered: Calculate the variable rate using the…

Calculate the variable rate using the High Low method of measuring cost function. Month Machine Hours Cost of Electricity July 42,000 December 22,000 $73,600 $53,600

Managerial Accounting: The Cornerstone of Business Decision-Making

7th Edition

ISBN:9781337115773

Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Chapter3: Cost Behavior And Cost Forecasting

Section: Chapter Questions

Problem 9DQ: Describe the cost formula for a strictly variable cost such as electrical power cost of 1.15 per...

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Question

Please explain the correct approach for solving this general accounting question.

Calculate the variable rate using the High Low method of measuring cost function.
Month Machine Hours Cost of Electricity
July
42,000
December 22,000
$73,600
$53,600

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