“Nelson Company’s activity for the first six months of 19×4 is as follows: Machine Electrical Month Hours Cost January 4,000 $3,120 February 6,000 $4,460 March 4,800 $3,500 April 3,800 $3,040 May 3,600 $2,900 June 4,200 $3,200 75. Using the high-low method, the fixed portion of the electrical cost each month would be a. $1,520 b. $440 c. $260 d. $560”,”4. The fixed portion of the electrical cost each month: Cost at the high activity level – Cost at the low activity level = Variable Cost High activity level – Low activity level4,460 – 2,900 = .65/hr6,000 – 3,600Elect. Cost = FC + .65Q4,460 = FC + .65 x 6,000FC = 4,460 – 3

“Nelson Company’s activity for the first six months of 19×4 is as follows: Machine Electrical Month Hours Cost January 4,000 $3,120 February 6,000 $4,460 March 4,800 $3,500 April 3,800 $3,040 May 3,600 $2,900 June 4,200 $3,200 75. Using the high-low method, the fixed portion of the electrical cost each month would be a. $1,520 b. $440 c. $260 d. $560”,”4. The fixed portion of the electrical cost each month: Cost at the high activity level – Cost at the low activity level = Variable Cost High activity level – Low activity level4,460 – 2,900 = .65/hr6,000 – 3,600Elect. Cost = FC + .65Q4,460 = FC + .65 x 6,000FC = 4,460 – 3

900 = $560″