Thompson Refrigerators Inc. needs to prepare pro forma financial statements for the next fiscal year. To do so, the company must forecast its total overhead cost. The actual machine hours and total overhead cost are presented below for the past six months.Using the high-low method, unit variable overhead cost is calculated to be:
A) $1.35.
B) $1.15.
C) $1.40.
D) $1.65.
E) $1.25.

Question

Thompson Refrigerators Inc. needs to prepare pro forma financial statements for the next fiscal year. To do so, the company must forecast its total overhead cost. The actual machine hours and total overhead cost are presented below for the past six months.Using the high-low method, unit variable overhead cost is calculated to be:
A) $1.35. 
B) $1.15. 
C) $1.40. 
D) $1.65. 
E) $1.25.

Quizplus · Accepted Answer

The Answer of Thompson Refrigerators Inc. needs to prepare pro forma financial statements for the next fiscal year. To do so, the company must forecast its total overhead cost. The actual machine hours and total overhead cost are presented below for the past six months.Using the high-low method, unit variable overhead cost is calculated to be:
A) $1.35. 
B) $1.15. 
C) $1.40. 
D) $1.65. 
E) $1.25.