Farnor, Inc., would like to estimate the variable and fixed components of its electrical costs and has compiled the following data for the last four months of operations. Using the high-low method of analysis, the estimated variable cost per machine hour for electricity is closest to:
A)$3.40
B)$2.14
C)$1.00
D)$0.87

Question

Farnor, Inc., would like to estimate the variable and fixed components of its electrical costs and has compiled the following data for the last four months of operations.  Using the high-low method of analysis, the estimated variable cost per machine hour for electricity is closest to:
A)$3.40 
B)$2.14 
C)$1.00 
D)$0.87

Quizplus · Accepted Answer

The Answer of Farnor, Inc., would like to estimate the variable and fixed components of its electrical costs and has compiled the following data for the last four months of operations.  Using the high-low method of analysis, the estimated variable cost per machine hour for electricity is closest to:
A)$3.40 
B)$2.14 
C)$1.00 
D)$0.87