Electricity Costs $9,221 $10,500 $6,774 $11,499 $14,125 $15,560 $12,375 $11,375 $6,572 $13,000 $15,510 $11,213 Month Machine Hours January February March 2,000 2,320 April May June July August September October 1,520 2,480 3,040 3,570 3,280 2,800 1,600 2,960 3,760 3,140 What is the estimated electricity cost for a month in which 1,900 machine hours are November December worked? (Round your answer to the nearest dollar). a. $8,403 b. $8,097 c. $8,059 d. $7,813 e. $7,941 f. $8,256 g. $9,046 h. None of the above

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
Electricity Costs
$9,221
$10,500
$6,774
$11,499
$14,125
$15,560
$12,375
$11,375
$6,572
$13,000
$15,510
$11,213
Month
January
February
Machine Hours
2,000
2,320
1,520
2,480
3,040
3,570
3,280
2,800
1,600
2,960
March
April
Мay
June
July
August
September
October
November
3,760
December
3,140
What is the estimated electricity cost for a month in which 1,900 machine hours are
worked? (Round your answer to the nearest dollar).
a. $8,403
b. $8,097
c. $8,059
d. $7,813
e. $7,941
f. $8,256
g. $9,046
h. None of the above
Transcribed Image Text:Electricity Costs $9,221 $10,500 $6,774 $11,499 $14,125 $15,560 $12,375 $11,375 $6,572 $13,000 $15,510 $11,213 Month January February Machine Hours 2,000 2,320 1,520 2,480 3,040 3,570 3,280 2,800 1,600 2,960 March April Мay June July August September October November 3,760 December 3,140 What is the estimated electricity cost for a month in which 1,900 machine hours are worked? (Round your answer to the nearest dollar). a. $8,403 b. $8,097 c. $8,059 d. $7,813 e. $7,941 f. $8,256 g. $9,046 h. None of the above
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Step 1

High low method is a method of cost estimation in which total fixed costs and variable cost per unit will be estimated and calculated by taking highest level activity and lowest level activity.

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