Margolo Company makes cross-country skis. The company controller wants to calculate the fixed and variable costs associated with janitorial services incurred by the factory. Data for the past 6 months were collected. Select the correct set of high and low months.
High Low

Question

Margolo Company makes cross-country skis. The company controller wants to calculate the fixed and variable costs associated with janitorial services incurred by the factory. Data for the past 6 months were collected.  Select the correct set of high and low months.
High Low

Quizplus · Accepted Answer

To determine the high and low months for janitorial services costs, we need to look for the months with the highest and lowest levels of activity that would affect these costs. Since janitorial services are typically related to the level of factory activity (i.e. more activity = more cleaning needed), we can look at the number of skis produced each month as a proxy for activity. Based on this logic, we would choose April (low production) as the low month and May (higher production) as the high month, making choice D the correct answer.

Margolo Company Makes Cross-Country Skis