Dallus wants to examine the behaviour of maintenance costs for budgeting purpose. Thefollowing data on machine hours worked and maintenance costs for the past year are collected:Month Machine Hours Maintenance CostJanuary18,000February 15,000March12,75021,000AprilMayJune11,88014,500July19,000August14,880September 10,000October13,360November 16,600December 18,800$20,60018,90015,10022,01013,20019,50025,00019,87412,00015,50019,80013,500Required:a. Use the high-low method to estimate the variable cost per machine hour and the fixed costper month.b. Plot and comment on the estimated cost function.C. Develop a formula to express the cost behaviour of ABC's maintenance costs.d. According to the budget, the machine is expected to work 200,000 hours next year. Howmuch is the budgeted maintenance costs?

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Dallus wants to examine the behaviour of maintenance costs for budgeting purpose. The following data on machine hours worked and maintenance costs for the past year are col Month Machine Hours Maintenance Cost January 18,000 February 15,000 March 12,750 21,000 April May June 11,880 14,500 $20,600 18,900 15,100 22,010 13,200 19,500

Dallus wants to examine the behaviour of maintenance costs for budgeting purpose. The following data on machine hours worked and maintenance costs for the past year are col Month Machine Hours Maintenance Cost January 18,000 February 15,000 March 12,750 21,000 April May June 11,880 14,500 $20,600 18,900 15,100 22,010 13,200 19,500

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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