Question 1

Electrical costs at one of Rome Corporation's factories are listed below:  Management believes that electrical cost is a mixed cost that depends on machine-hours.
Using the high-low method, the estimate of the fixed component of electrical cost per month is closest to: (Round your intermediate calculations to 2 decimal places.)

Accepted Answer

A)   $822
B)   $743
C)   $38
D)   $944E) All of the above
F) A) and B)

Question 2

Electrical costs at one of Finfrock Corporation's factories are listed below:  Management believes that electrical cost is a mixed cost that depends on machine-hours. Use the high-low method to estimate the variable and fixed components of this cost. Compute the variable component first, rounding off to the nearest whole cent. Then compute the fixed component, rounding off to the nearest whole dollar. Those estimates are closest to: (Round your intermediate calculations to 2 decimal places.)

Accepted Answer

A)   $7.96 per machine-hour; $11,517 per month
B)   $11.13 per machine-hour; $40,510 per month
C)   $9.61 per machine-hour; $5,533 per month
D)   $0.13 per machine-hour; $40,246 per monthE) None of the above
F) C) and D)

Exam 13: Analyzing Mixed Costs

Correct Answer
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Correct Answer
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Exam 13: Analyzing Mixed Costs

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Correct Answer
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Correct Answer
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