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Moonstar Company has the experience over the past five quarters which is given below:

Units produced         Electricity cost ($)
27,000                     101,000
32,000                     120,000
31,000                     116,000
20,000                       84,000
22,000                       90,000

1) Find out the equation for electricity cost (Y) as a function of units produced (X) using the high-low method. Suppose a linear function.

2)  Using your equation, estimate electricity cost at the volume of 29,000 units produced.

Accounting Basics, Accounting

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  • Reference No.:- M910097

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