I need help with 1-3, please. Thank you! Meyer Company, which uses the high-low

Question

I need help with 1-3, please. Thank you!

Meyer Company, which uses the high-low method to analyze cost behavior, has determined that machine hours best predict the company's total utilities cost. The company's cost and machine hour usage data for the first six months of the year follow: EEB (Click the icon to view the data.) Requirements Using the high-low method, answer the following questions: 1. What is the variable utilities cost per machine hour? 2. What is the fixed cost of utilities each month? 3. If Meyer Company uses 1,220 machine hours in a month, what will its total costs be? Data Table Month Total Cost Machine Hours 1,040 1,130 1,020 1,290 1,340 1,420 Requirement 1. What is the variable utilities cost per machine hour? Janu Let's begin by determining the formula that is used to calculate the variable cost (slope) Change in cost Change in volume Variable cost (slope) March (Round the variable cost to the nearest cent.) .$ 4,000 $4,144 Using the high-low method, the variable utilities cost per machine hour is $ May June Print Done

Explanation / Answer

1 Total cost Machine hours High level 4144 1420 Low level 3464 1020 Change 680 400 Variable utilities cost per machine hour = 680/400= $1.70 2 Total operating cost-Total variable cost = Fixed cost 4144-(1420*1.7)= $1730 3 Total costs for 1220 machine hours = 1730+(1220*1.7)= $3804

Related Questions

Navigate

• Browse (All)
• Browse I
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.