The manager of a local lodge uses the high-low technique to separate fixed and variable maintenance costs. The following data is available: Month Vehicle working hours Maintenance costs (N$) January 8 500 35 867 February 8 000 34 400 March 8 800 36 747 April 9 200 37 921 May 9 458 38 678 June 8 200 34 987 July 8 695 36 439 August 9 313 38 252 September 9 983 40 218 Calculate the variable cost per hour (answer to the nearest NS) Answer

The manager of a local lodge uses the high-low technique to separate fixed and variable maintenance costs. The following data is available: Month Vehicle working hours Maintenance costs (N$) January 8 500 35 867 February 8 000 34 400 March 8 800 36 747 April 9 200 37 921 May 9 458 38 678 June 8 200 34 987 July 8 695 36 439 August 9 313 38 252 September 9 983 40 218 Calculate the variable cost per hour (answer to the nearest NS) Answer

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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Given the following cost and activity observations for Bounty Company's utilities, use the high-low method to determine Bounty's variable utilities cost per machine hour. Round your answer to the nearest cent. Cost Machine Hours March $3,091 14,781 April 2,676 9,929 May 2,812 11,845 June 3,520 17,889 a.$0.49 b.$0.53 c.$0.11 d.$1.17
Muffler Incorporated produces floor mats for cars and trucks. The owner, Kenneth Muffler, asked you to assist him in estimating his maintenance costs. Together, Mr. Muffler and you determined that the single best cost driver for maintenance costs was machine hours. Below are data from the previous fiscal year for maintenance expense and machine hours: Month 1 2 3 4 5 6 7 8 9 10 11 12 Multiple Choice O O о Maintenance Expense $ 3,440 O O Using the high-low method, total monthly fixed cost is calculated to be (Round final answer to full dollar amount with no decimal places): $212. $153. $520. $462. 3,630 3,810 3,940 3,940 4,320 3,930 $280. 3,740 3,460 3,080 2,940 3,200 Machine Hours 2,360 2,460 2,560 2,590 2,440 2,600 2,580 2,550 2,370 2,240 1,670 2,230
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