As part of his job as cost analyst,Max Thompson collected the following information concerning the operations of the Machining Department:
$$\begin{array} { l c c }
\text { Observation } & \text { Machine-hours } & \text { Total Operating Costs } \
\hline \text { January } & 4,700 & \$ 43,000 \
\text { February } & 5,060 & 45,395 \
\text { March } & 4,180 & 42,535 \
\text { April } & 4,500 & 43,600 \
\text { May } & 4,250 & 42,890
\end{array}$$ Required:
a.Use the high-low method to determine the estimating cost function with machine-hours as the cost driver.
b.If June's estimated machine-hours are 4,300,calculate the total estimated costs of the Machining Department?

Question

As part of his job as cost analyst,Max Thompson collected the following information concerning the operations of the Machining Department:
 $$\begin{array} { l c c } 
\text { Observation } & \text { Machine-hours } & \text { Total Operating Costs } \
\hline  \text { January } & 4,700 & \$ 43,000 \
\text { February } & 5,060 & 45,395 \
\text { March } & 4,180 & 42,535 \
\text { April } & 4,500 & 43,600 \
\text { May } & 4,250 & 42,890
\end{array}$$ Required:
a.Use the high-low method to determine the estimating cost function with machine-hours as the cost driver.
b.If June's estimated machine-hours are 4,300,calculate the total estimated costs of the Machining Department?

Quizplus · Accepted Answer

The Answer of As part of his job as cost analyst,Max Thompson collected the following information concerning the operations of the Machining Department:
 $$\begin{array} { l c c } 
\text { Observation } & \text { Machine-hours } & \text { Total Operating Costs } \
\hline  \text { January } & 4,700 & \$ 43,000 \
\text { February } & 5,060 & 45,395 \
\text { March } & 4,180 & 42,535 \
\text { April } & 4,500 & 43,600 \
\text { May } & 4,250 & 42,890
\end{array}$$ Required:
a.Use the high-low method to determine the estimating cost function with machine-hours as the cost driver.
b.If June's estimated machine-hours are 4,300,calculate the total estimated costs of the Machining Department?

As Part of His Job as Cost Analyst,Max Thompson Collected