Maintenance Costs at a Whetsel Corporation Factory Are Listed Below

question 166

Multiple Choice

Maintenance costs at a Whetsel Corporation factory are listed below: Management believes that maintenance cost is a mixed cost that depends on machine-hours.Use the high-low method to estimate the variable and fixed components of this cost.Compute the variable component first and round off to the nearest whole cent.Compute the fixed component second and round off to the nearest whole dollar.These estimates would be closest to:

• A)$8.86 per machine-hour;$20, 577 per month
• B)$0.11 per machine-hour;$48, 192 per month
• C)$15.48 per machine-hour;$48, 103 per month
• D)$8.81 per machine-hour;$20, 718 per month

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Definitions:

Self-serving Bias

A cognitive bias that causes individuals to attribute their successes to internal factors while attributing failures to external factors.

Spotlight Effect

The tendency to overestimate the extent to which others notice and evaluate our appearance, performance, and mistakes.

Narcissism

A personality trait characterized by a long-term pattern of exaggerated self-importance, the need for admiration, and a lack of empathy for others.

Reciprocal Determinism

A concept in psychology that suggests a person's behavior both influences and is influenced by personal factors and the social environment.