Question

Machine Master, Inc. had the following data regarding monthly power costs: Month Machine hours Power cost...

  1. Machine Master, Inc. had the following data regarding monthly power costs:

Month

Machine hours

Power cost

Jan

300

$650

Feb

600

720

Mar

400

685

Apr

200

640

May

350

675
  1. Use the high-low method, estimate the cost formula regarding monthly power costs
  1. Assume that management expects 500 machine hours in May. Calculate May’s power cost using machine hours as the basis for prediction.
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