Buckeye Company Has Provided the Following Data for Maintenance Cost

question 102

Multiple Choice

Buckeye Company has provided the following data for maintenance cost: $$\begin{array} { | l | l | l | } \hline & \text { Prior Year } & \text { Current Year } \\\hline \text { Machine hours } & 12,500 & 15,000 \\\hline \text { Maintenance cost } & \$ 27,000 & \$ 31,000 \\\hline\end{array}$$ The best estimate of the cost formula for maintenance is?

• A)$27,000 per year plus $1.60 per machine hour.
• B)$21,625 per year plus $0.625 per machine hour.
• C)$7,000 per year plus $0.625 per machine hour.
• D)$7,000 per year plus $1.60 per machine hour.