1. Gargymal Company would like to estimate the variable and fixed components of its electrical costs and has compiled the following data for the past

ACCOUNTING

Multiple Choice

Use the following information to answer this question.

Gargymal Company would like to estimate the variable and fixed components of its electrical costs and has compiled the following data for the past five months of operations.

Machine Hours

Electrical Cost

August

1,000

$1,620

September

900

$1,510

October

1,500

$1,870

November

2,000


$1,950

December

1,300

$1,730

Using the high-low method of analysis, the estimated fixed cost per month for electricity is closest to which of the following?
A. $1,306.50
B. $870.00
C. $1,150.00
D. $1,290.00

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