high low method machine hours
Start your trial now. Y Machine Utility Month Hours.
To illustrate the high-low method lets assume that a company had total costs of electricity of 18000 in the month when its highest activity was 120000 machine hours.
. If factory overhead is Rs 3 00000 and total machine hours are 1500 the machine hour rate is Rs 200 per machine hour Rs 3 00000 1500 hours. First week only 699. 90000 110000 130000 150000 100000 120000 140000 160000 180000 200000 220000 240000 260000 280000 300000 Machine-Hours Maintenance Costs.
View high low methoddocx from BSMA 401 at STI College multiple campuses. Use the high-low method to estimate the variable cost per machine hour and the fixed cost per month. Machine Hours 9000 3000 6000 Highest Lowest Difference Utility Cost 1960 880 1080 a.
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Skip to main content. 13000 machine hours are worked. High Low Method is a mathematical technique used to determine the fixed and variable elements of historical costs that are partially fixed and partially variable.
Based on the following information calculate fixed costs per month using the high-low method. Solution for Using the high-low method how much is the electricity costs if the actual machine hours used is 2800. Machine Hours 22000 32000 26000 24000 Cost 56000 May June July August Oa.
High Low Method of Machine Hours 8000 10000 11000 9000 14000 12000 Total Maintenance Costs 600000 640000 800000 700000 900000 870000. Barkoff Enterprises which uses the high-low method to analyze cost behavior has determined that machine hours best explain the companys utilities cost. Assume that the cost of electricity at a small manufacturing facility is a mixed cost since the company has only one electricity meter for air quality cooling.
The high-low method involves taking the. Factory overheadMachine hours. In cost accounting a way of attempting to separate out fixed and variable costs given a limited amount of data.
Hotlanta Inc which uses the high-low method to analyze cost behavior has determined that machine hours best explain the companys utilities cost. Example of High-Low Method. The companys relevant range of.
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