Question: Robert Inc. has total monthly maintenance costs that fluctuate with varying direct labour hours as follows: Maintenance Cost $610,000 February $590,000 $580,000 $530,000 $570,000

Robert Inc has total monthly maintenance costs that fluctuate with varying direct labour hours asfollows:MaintenanceCostL

Robert Inc. has total monthly maintenance costs that fluctuate with varying direct labour hours as follows: Maintenance Cost $610,000 February $590,000 $580,000 $530,000 $570,000 $540,500 Labour Hours January 9,000 9.500 March April May June 8,000 6,500 7.000 6,750 Required: 1. Use the high-low method to separate the maintenance expense into its variable and fixed cost components. (5 marks) 2. State the cost formula for the maintenance expense (1 mark) 3. Would you recommend using the cost formula from your answer in part 2 to estimate the total maintenance expense for 6,558 labour hours? Why or why not? (1 mark)

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