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The following information is available for a company's maintenance cost over the last seven months. Units Produced Maintenance Cost 100 $ 160 120 150 Month June July August September October November December 210 240 60 4,550 6,530 4,770 5,430 6,750 7,410 3,450 Using the high-low method, estimate both the fixed and variable components of its maintenance cost

The following information is available for a company's maintenance cost over the last seven months. Units Produced Maintenance Cost 100 $ 160 120 150 Month June July August September October November December 210 240 60 4,550 6,530 4,770 5,430 6,750 7,410 3,450 Using the high-low method, estimate both the fixed and variable components of its maintenance cost

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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The following information is available for a company's maintenance cost over the last seven months. Units Produced 100 160 120 Month June July August September October November December 150 210 240 60 Change in cost Change in volume Using the high-low method, estimate both the fixed and variable components of its maintenance cost. High-Low method - Calculation of variable cost per maintenance hour Cost at high point minus cost at low point Volume at high point minus volume at low point Total cost at the high point Variable costs at the high point: Volume at the high point: Variable cost per unit produced Total variable costs at the high point Total fixed costs Maintenance Cost $ Total cost at the low point Variable costs at the low point Volume at the low point: Variable cost per unit produced Total variable costs at the low point Total fixed costs 4,550 6,530 4,770 5,430 6,750 7,410 3,450
Transcribed Image Text:The following information is available for a company's maintenance cost over the last seven months. Units Produced 100 160 120 Month June July August September October November December 150 210 240 60 Change in cost Change in volume Using the high-low method, estimate both the fixed and variable components of its maintenance cost. High-Low method - Calculation of variable cost per maintenance hour Cost at high point minus cost at low point Volume at high point minus volume at low point Total cost at the high point Variable costs at the high point: Volume at the high point: Variable cost per unit produced Total variable costs at the high point Total fixed costs Maintenance Cost $ Total cost at the low point Variable costs at the low point Volume at the low point: Variable cost per unit produced Total variable costs at the low point Total fixed costs 4,550 6,530 4,770 5,430 6,750 7,410 3,450
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