Song, Inc., uses the high-low method to analyze cost behavior. The company observed that at 20,000 machine
Question:
Song, Inc., uses the high-low method to analyze cost behavior. The company observed that at 20,000 machine hours of activity, total maintenance costs averaged $34.30 per hour. When activity jumped to 27,000 machine-hours, which was still within the relevant range, the average total cost per machine hour was $27.30.
Required
On the basis of this information, the variable cost per machine hour was (Round your final answer to 2 decimal places):
On the basis of this information, the fixed cost was (Round your intermediate calculations to 2 decimal places final answer to the nearest dollar amount):
On the basis of this information, what were the total maintenance costs when the company experienced 25,000 machine hours? (Round your intermediate calculations to 2 decimal places final answer to the nearest dollar amount.)
Managerial Accounting
ISBN: 978-0176223311
1st Canadian Edition
Authors: Karen Wilken Braun, Wendy Tietz, Walter Harrison, Rhonda Pyp