Machine hours and electricity costs for Wells Industries for 2011 were as follows: Machine Electricity Month Hours Costs January 2,000 $ 9,200 February 2,320 10,500 March 1,520 6,750 April 2,480...

Machine

Electricity

Month

Hours

Costs

January

2,000

$  9,200

February

2,320

10,500

March

1,520

6,750

April

2,480

11,500

May

3,040

14,125

June

2,640

11,000

July

3,280

12,375

August

2,800

11,375

September

1,600

7,750

October

2,960

13,000

November

3,760

15,500

December

3,360

13,875

A.

Using the

high-low method
, develop an estimate of
variable
electricity costs per machine hour.

______________________________

B.

Using the

high-low method
, develop an estimate of
fixed
electricity costs per month.

______________________________

C.

Using the high-low method, develop a
cost function (linear cost equation)
for use in

estimating monthly electricity costs.

______________________________

D.

Using the

cost equation

you developed in “C” above, estimate the
total electricity costs

for a month in which
3,000 machine hours
are worked.

______________________________