The controller of Menno Corp presents you with the following ...

[appyboo]

The controller of Menno Corp presents you with the following observations in a general ledger account called Maintenance:

Month	Machine-hours	Maintenance Costs Incurred
January	6,000	$4,000
February	8,000	4,750
March	8,500	4,900
April	9,000	5,000
May	7,000	4,400
June	10,000	5,400

Using the high- low method, what is the variable maintenance cost per machine hour at Menno Corp?
◦ $0.35
◦ $1.50
◦ $0.67
◦ $0.54

[Mollythedog]

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[DyllonKazuo]

The controller of Menno Corp presents you with the following observations in a general ledger account called Maintenance:

Month	Machine-hours	Maintenance Costs Incurred
January	6,000	$4,000
February	8,000	4,750
March	8,500	4,900
April	9,000	5,000
May	7,000	4,400
June	10,000	5,400

Using the high-low method, what is the monthly fixed maintenance cost at Menno Corp?
◦ $18,460
◦ $7,785
◦ $1,900
◦ $1,260

[amandalm]

$1,900

[NguyenJ]

The controller of Menno Corp presents you with the following observations in a general ledger account called Maintenance:

Month	Machine-hours	Maintenance Costs Incurred
January	6,000	$4,000
February	8,000	4,750
March	8,500	4,900
April	9,000	5,000
May	7,000	4,400
June	10,000	5,400

Using the high-low method, what will the total monthly manufacturing costs be if Menno Corp produces 7,500 units?
◦ $2,625
◦ $5,555
◦ $4,050
◦ $4,525

[sailorcrescent]

$4,525

[LaDunn]

The controller of Menno Corp presents you with the following observations in a general ledger account called Maintenance:

Month	Machine-hours	Maintenance Costs Incurred
January	6,000	$4,000
February	8,000	4,750
March	8,500	4,900
April	9,000	5,000
May	7,000	4,400
June	10,000	5,400

Using the high-low method estimate the cost function for Menno Corp.'s monthly maintenance costs

[rachel]

y = $1900 + $0.35X
                       

Step 1	​
High cost	$5,400
Low cost	$(4,000)
Change in cost	$1,400
​	​
High activity	10,000
Low activity	(6,000)
Change in activity	4,000
​	​
Change in cost	$1,400
Divide by	Divide by
Change in activity	4,000
Variable cost per unit	$0.35

Step 2	​
High cost	$5,400
Low cost	$(4,000)
Change in cost	$1,400
​	​
High activity	10,000
Low activity	(6,000)
Change in activity	4,000
​	​
Change in cost	$1,400
Divide by	Divide by
Change in activity	4,000
Variable cost per unit	$0.35
​	​
Now, using high point data:	​
Total variable cost at high point:	​
High activity	10,000
Variable cost per unit	$0.35
Total variable cost at high point	$3,500
​	​
Total cost at high point	$5,400
Less total variable cost at high point	$(3,500)
Fixed cost	$1,900