You Have Calculated,using the High-Low Method,a Variable Cost Per Machine

question 116

Multiple Choice

You have calculated,using the high-low method,a variable cost per machine hour of $0.80 for your production power costs.Power costs at 6,000 machine hours are $5,400;at 9,000 machine hours,they are $7,800.What are the total fixed costs that you would use to estimate production power costs for your company at any level within your relevant range?

• A)$600
• B)$6,400
• C)$2,400
• D)$4,800

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