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High-Low Method to Determine Fixed Cost and Variable Rate MeGarvey Manufacturing Company had the following 12 months of data on purchasing cost and number of purchase orders. 1. Determine the high point and the low point. Month with high number of purchase orders Month with low number of purchase orders Determine the high point and the low point. Nonth with high number of purchase orders Month with low number of purchase orders - Calculate the variable rate for purchasing cost based on the number of purchase orders. (Round to the nearest cent.) x per purchase order Calculate the fixed monthy cost of purchasing. x 4. Write the cost formula for the purchasing activity showing the fixed cost and the variable rate. Round variable rate to the nearest cent. Total purchasing cost =$ 5. If McGarvey Manufacturing Company estimates that next month will have 440 purchase orders, what is the total estimated purchasing cost for that month? 6. What if McGarvey Manufacturing wants to estimate purchasing cost for the coming year and expects 5,330 purchase orders? What will estimated total purchasing be? What is the total fixed purchasing cost? Wry doesn't it equal the fixed cost calculated in Requirement 3 above