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The maintenance expenses of a company are to be analyzed for purposes of constructing a flexible budget. Examination of past records disclosed the following costs and volume measures: Highest and Lowest: Cost per month $86,000 and $74,000; Machine hours 96,000 and 66,000.

Using the high-low-point method of analysis, the estimated variable cost per machine hour is:

a) $0.40

b) $0.20

c) $0.90

d) $0.10

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