Supply costs at Chobot Corporation's chain of gyms are listed below: Management believes that supply cost is a mixed cost that depends on client-visits. Use the high-low method to estimate the variable and fixed components of this cost. Compute the variable component first, rounding off to the nearest whole cent. Then compute the fixed component, rounding off to the nearest whole dollar. Those estimates are closest to:
A)$2.18 per client-visit; $26,745 per month
B)$1.01 per client-visit; $14,330 per month
C)$1.04 per client-visit; $13,949 per month
D)$0.99 per client-visit; $14,607 per month

Question

Supply costs at Chobot Corporation's chain of gyms are listed below:  Management believes that supply cost is a mixed cost that depends on client-visits. Use the high-low method to estimate the variable and fixed components of this cost. Compute the variable component first, rounding off to the nearest whole cent. Then compute the fixed component, rounding off to the nearest whole dollar. Those estimates are closest to:
A)$2.18 per client-visit; $26,745 per month 
B)$1.01 per client-visit; $14,330 per month 
C)$1.04 per client-visit; $13,949 per month 
D)$0.99 per client-visit; $14,607 per month

Quizplus · Accepted Answer

The Answer of Supply costs at Chobot Corporation's chain of gyms are listed below:  Management believes that supply cost is a mixed cost that depends on client-visits. Use the high-low method to estimate the variable and fixed components of this cost. Compute the variable component first, rounding off to the nearest whole cent. Then compute the fixed component, rounding off to the nearest whole dollar. Those estimates are closest to:
A)$2.18 per client-visit; $26,745 per month 
B)$1.01 per client-visit; $14,330 per month 
C)$1.04 per client-visit; $13,949 per month 
D)$0.99 per client-visit; $14,607 per month

Supply Costs at Chobot Corporation's Chain of Gyms Are Listed