Maintenance expenses of a company are to be analyzed for purposes of constructing a flexible budget. Examination of past records disclosed the following costs and volume measures:$\begin{array}{lrr}
& \text { Highest } & \text { Lowest } \
\text { Cost per month } & \$ 42,000 & \$ 34,000 \
\text { Machine hours } & 46,000 & 30,000
\end{array}$Using the high-low technique, estimate the annual fixed cost for maintenance expenditures:
A) $447,000.
B) $240,000.
C) $230,000.
D) $384,000.
E) $228,000.

Question

Maintenance expenses of a company are to be analyzed for purposes of constructing a flexible budget. Examination of past records disclosed the following costs and volume measures:$\begin{array}{lrr} 
& \text { Highest } & \text { Lowest } \
\text { Cost per month } & \$ 42,000 & \$ 34,000 \
\text { Machine hours } & 46,000 & 30,000
\end{array}$Using the high-low technique, estimate the annual fixed cost for maintenance expenditures: 
A) $447,000.
B) $240,000.
C) $230,000.
D) $384,000.
E) $228,000.

Quizplus · Accepted Answer

The Answer of Maintenance expenses of a company are to be analyzed for purposes of constructing a flexible budget. Examination of past records disclosed the following costs and volume measures:$\begin{array}{lrr} 
& \text { Highest } & \text { Lowest } \
\text { Cost per month } & \$ 42,000 & \$ 34,000 \
\text { Machine hours } & 46,000 & 30,000
\end{array}$Using the high-low technique, estimate the annual fixed cost for maintenance expenditures: 
A) $447,000.
B) $240,000.
C) $230,000.
D) $384,000.
E) $228,000.

Maintenance Expenses of a Company Are to Be Analyzed for Purposes