Hanno Legal Services provides legal advice to clients. The following data apply to the first six months

Question:

Hanno Legal Services provides legal advice to clients. The following data apply to the first six months of operation:

Month Mar. Feb. May Jan. Apr. 160 $12,800 8,500 June Service hours 200 $16,000 80 120 180 $14,400 8,761 60 $4,800 6,200

.:.

Required

a. What is the average service revenue per hour for the six-month time period?

b. Use the high-low method to estimate the total monthly fixed cost and the variable cost per hour.

c. Determine the average contribution margin per hour.

d. Use the scatter graph method to estimate the total monthly fixed cost and the variable cost per hour.

e. Compare the results of the two methods and comment on any differences.

Contribution Margin
Contribution margin is an important element of cost volume profit analysis that managers carry out to assess the maximum number of units that are required to be at the breakeven point. Contribution margin is the profit before fixed cost and taxes...