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    High-Low method

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    Johnson Company has observed that at an activity level of 5,000 units the cost for maintenance is $6,500 and at 10,000 units the cost for maintenance is $9,000. Using the high-low method, the cost formula for maintenance is

    $4,000 plus $.50 per unit
    $3,000 plus $.60 per unit
    $.90 per unit
    $1.30 per unit

    © BrainMass Inc. brainmass.com June 3, 2020, 10:02 pm ad1c9bdddf
    https://brainmass.com/business/accounting/high-low-method-212257

    Solution Preview

    We separate the fixed and variable costs
    Variable cost = ...

    Solution Summary

    The solution explains how to determine the cost formula using the high low method

    $2.19

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