Task1. Herbart Company collected the following information on power costs and factory machine usage for the last six months:
|
|
Power Cost
|
Factory Machine Hours
|
|
January
|
$24,400
|
13,900
|
|
February
|
30,300
|
17,600
|
|
March
|
29,000
|
16,800
|
|
April
|
22,340
|
13,200
|
|
May
|
19,900
|
11,600
|
|
June
|
14,900
|
6,600
|
Required: Using the high-low technique of analyzing costs answer the following questions and demonstrate all calculation to support your answers.
Part (a) What is estimated variable portion of power costs per factory machine hour?
Part (b) What is estimated fixed power cost each month?
Part (c) If it is estimated that 10,000 factory machine hours will be run in the month of July, what is the anticipated total power cost for July?