Answer Question 5

High-Low Method fixed, but found that tanning salon costs increased with the number of appointments. Costs for this service over the past 8 months are as follows: 1. Which month represents the high point? The low point? High point Low point In your calculations, round per unit costs to the nearest cent. calculations. Round the fixed cost per month to the nearest dollar and use it in vour further calculations. Variable rate for tanning per tanning appointment Fixed cost per month 4 3. Using the variable rate and fixed cost, what is the cost formula for tanning services? 5. Calculate the total predicted cost of tanning services for September for 3,860 appointments. If required, round the final answers to the nearest dollar. 4 x While the total cost prediction is greater than the prediction from Requirement 4, Sophia should be concemed that the number of tanning appointments of 3,860 in this calculation is the highest number of tanning appointments (3,600) contained in the 8 months of data upon which the high-low method constructed the cost function. 6. Which of the following statements is correct when Sophia uses the high-low method to estimate the costs? Fasedhack Crack My Work 1. Review high-low method. This method separates mixed costs. High and low points are determined by activity. Construct a cost formula using the fixed cost and variable rate multiplied by the number of appointments (x). Dependent variable is the cost being predicted. Independent variable is the cost driver. 4. Use the cost formula in #3 and the 2,500 appointments. 5. Consider the elements used in the high-low method with only two data points. Consider the time frame used