Paine Company Wishes to Determine the Fixed Portion of Its

question 5

Multiple Choice

Paine Company wishes to determine the fixed portion of its electrical costs (a mixed cost) . Management believes that the variable portion of the electrical costs is driven by machine-hours. Information for the previous three months follows: $\begin{array}{lcc}&\text { Machine-hours }&\text {Electrical cost}\\ \text {January } &33,000 &£ 600 \\ \text { February } &31,000& £585\\ \text { March} &34,000& £610\end{array}$

Using the high-low method, the fixed portion of the company's electrical costs would be estimated to be closest to:

• A)£283.
• B)£327.
• C)£375.
• D)£408.

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Definitions:

Fahrenheit

A scale of temperature on which water freezes at 32 degrees and boils at 212 degrees under standard conditions.

Scatterplot

A type of graph used in statistics to visually display and compare two variables for a set of data, showing their relationship.

Histogram

A graphical representation of the distribution of numerical data, often used to visualize the distribution of a dataset.

Ceramics

Materials made by heating and cooling natural clay or compounds to develop hard, durable items such as tiles, pottery, and sculptures.