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Exercise 5-5 a1-a2 (Video) The controller of Blossom Industries has collected the following monthly expense data...

Exercise 5-5 a1-a2 (Video)

The controller of Blossom Industries has collected the following monthly expense data for use in analyzing the cost behavior of maintenance costs.

Month

Total
Maintenance Costs

Total
Machine Hours

January $3,018 4,000
February 3,429 4,572
March 4,115 6,858
April 4,633 9,030
May 3,658 5,715
June 4,817 9,140
Determine the variable-cost components using the high-low method. (Round answer to 2 decimal places e.g. 2.25.)
Variable cost per machine hour $

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Determine the fixed cost components using the high-low method.
Fixed costs $
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Answer #1
1.) Variable Cost per Machine Hours $ 0.35 =(4817-3018)/(9140-4000)
( Change in Cost / Change in Machine hours )
2.) Fixed Costs $ 1,618 =4817-(9140*0.35)
( Total Costs - Total Variable Cost )
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