Batle Company, which uses the high-low method to analyze cost behavior, has dete

Question

Batle Company, which uses the high-low method to analyze cost behavior, has determined that machine hours best predict the company's total uilities cost. The company's cost and machine hour usage data for the first six months of the year follow EEB Click the icon to view the data) Requirements Using the high-Jow method, answer the following questions 1. What is the variable utilities cost per machine hour? 2. What is the fixed cost of utilities each month? 3. If Battle Company uses 1,270 machine hours in a month, what will its total costs be? Requirement 1. What is the variable ufilities cost per machine hour? determining the formula that is used to calculate the variable cost (slope) Variable cost (slope) Round the variable cost to the nearest cent) Using the high low method, the variable utilities cost per machine hour is S

Explanation / Answer

Dear Student Thank you for using Chegg Please find below the answer Statementshowing Computations Paticulars Amount Cost at highest level of activity                   4,232.00 Cost at Lowest level of activity                   3,467.00 Highest level of activity                   1,460.00 Lowest Level of activity                   1,010.00 Variable cost per unit = (4232 - 3467)/(1460 - 1010) Variable cost per unit = 765 / 450 Variable cost per unit = $1.70 2) Fixed Costs = 4232 - 1460*1.70 Fixed Costs = 1750 3) Total costs = 1750 + 1270*1.70                   3,909.00

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