Schaffer Company, which uses the high-low method to analyze cost behavior, has determined that machine hours best
Question:
Month Total Cost Machine Hours
January........................................................................... $3,460....................1,070
February......................................................................... $3,760....................1,170
March............................................................................. $3,500....................1,000
April................................................................................ $3,780....................1,200
May................................................................................. $4,700....................1,330
June................................................................................ $4,200....................1,400
Requirements
Using the high-low method, answer the following questions:
1. What is the variable utilities cost per machine hour?
2. What is the fixed cost of utilities each month?
3. If Schaffer Company uses 1,210 machine hours in a month, what will its total costs be?
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