The controller of Hall Industries has collected monthly expense data for use in

Question

The controller of Hall Industries has collected monthly expense data for use in analyzing the cost behavior of maintenance costs. the following Total Total Month Maintenance Costs Machine January February March $3,018 3,429 4,115 5,143 3,658 5,281 Hours 4,000 4,572 6,858 9,030 S,715 9,144 May Determine the variable-cost components using the high-low method. (Round variable cost to 2 decimal places e.g. 12.25.) Variable cost per machine hour s Determine the fixed cost components using the high-low method. (Round answer to 0 decimal places e.g. 2,520.) Fixed costs Question Attempts: 0 of i used save rOR LATER SUBMIT ANSWER Q Search or enter website name 3 5 6

Explanation / Answer

1 Variable cost per machine hour=(5281-3018)/(9144-4000)= $0.44 Fixed costs = 5281-(9144*0.44)= $1258 2 Direct materials in flexible budget=27000/9000*9200= $27600 Variance = 28000-27600 = $400 Unfavorable

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