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Author Question: Taunton Company uses the high-low method to estimate its cost function. The information for 2017 is ... (Read 111 times)

fasfsadfdsfa

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Question 1

Taunton Company uses the high-low method to estimate its cost function. The information for 2017 is provided below:

Machine-hours Costs
 Highest observation of cost driver 3,000 $300,000
 Lowest observation of cost driver 2,500 $277,500

What is the constant for the estimated cost equation?
◦ $277,500
◦ $300,000
◦ $165,000
◦ $135,000

Question 2

Taunton Company uses the high-low method to estimate its cost function. The information for 2017 is provided below:

Machine-hours Costs
 Highest observation of cost driver 4,000 $332,000
 Lowest observation of cost driver 3,000 $312,000

What is the estimated cost function for the above data?
◦ y = 332,000 + 83X
◦ y = 312,000 + 104X
◦ y = 252,000 + 20.00X
◦ y = 92.00X


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Marked as best answer by fasfsadfdsfa on Mar 6, 2021

Viet Thy

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