The Penquin Company Has Obtained the Following Data Required:
A) Using the High-Low Method, Determine the Cost

question 95

Essay

The Penquin Company has obtained the following data:
$\begin{array}{lll}\text { Mlonth }&\text { Indirect Production Costs }&\text { Direct Labor Hours }\\\text { July } & \$ 92,095 & 4,900 \\\text { August } & \$ 105,056 & 5,480 \\\text { September } & \$ 80,000 & 3,000 \\\text { October } & \$ 99,400 & 4,400 \\\text { November } & \$ 110,000 & 6,000 \\\text { December } & \$ 97,404 & 3,900\end{array}$
Required:
A) Using the high-low method, determine the cost function for the above data. Round to two decimal places.
B) If direct labor hours equal 10,000, what are the total expected indirect production costs?

• A) Using the high-low method, determine the cost function for the above data. Round to two decimal places.
• B) If direct labor hours equal 10,000, what are the total expected indirect production costs?

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Definitions:

Government

The system or group of people governing an organized community, often a state, and the mechanism through which political authority is exercised.

Law

A system of rules and guidelines, usually enforced through a set of institutions, that govern behavior and maintain order in a society.

Vroom's Expectancy Theory

A theory that proposes an individual's motivation is affected by the expectation that one's effort will lead to desired performance and the value of the reward associated with that performance.

Outcomes Of Behavior

The results or consequences that follow from one's actions or conduct.