Fulton and Sons, Inc. presently leases a copy machine under an agreement that calls for a fixed fee each month and a charge for each copy made. Fulton made 7,000 copies and paid a total of $360 in March; in May, the firm paid $280 for 5,000 copies. The company uses the high-low method to analyze costs. How much would Fulton pay if it made 5,500 copies? a. $300. b. $322. c. $292.50. d. $382.50. e. None of the answers is correct.
Fulton and Sons, Inc. presently leases a copy machine under an agreement that calls for a fixed fee each month and a charge for each copy made. Fulton made 7,000 copies and paid a total of $360 in March; in May, the firm paid $280 for 5,000 copies. The company uses the high-low method to analyze costs. How much would Fulton pay if it made 5,500 copies? a. $300. b. $322. c. $292.50. d. $382.50. e. None of the answers is correct.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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1. Fulton and Sons, Inc. presently leases a copy machine under an agreement that calls for a fixed fee each month and a charge for each copy made. Fulton made 7,000 copies and paid a total of $360 in March; in May, the firm paid $280 for 5,000 copies. The company uses the high-low method to analyze costs.
How much would Fulton pay if it made 5,500 copies?
a. $300.
b. $322.
c. $292.50.
d. $382.50.
e. None of the answers is correct.
2. The following data relate to the Torrence Company for May and August:
May | August | ||||||
Maintenance hours | 25,000 | 29,000 | |||||
Maintenance cost | $ | 1,175,000 | $ | 1,247,000 |
a. The fixed maintenance cost is $72,000 per month.
b. The variable maintenance cost is $22 per hour.
c. The variable maintenance cost is $18 per hour.
d. The variable maintenance cost is $24 per hour.
e. More than one of the other answers is true
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