Problem: Inspection costs at one of Krivanek Corporation's factories are listed below:
Units Produced Inspection cost
January 630 $8850
February 615 $8819
March 602 $8760
April 595 $8743
May 688 $9036
June 626 $8866
July 646 $8920
August 670 $8977
September 678 $9013
Management believes that inspection cost is a mixed cosst that depends on units produced.
Using the high low method, the estimate of the variable component of inspection is closest to: $3.15, $0.32, $3.40 or $13.91