The controller of Dugan Industries has collected the following monthly expense data for use in analyzing the cost behavior of maintenance costs.
MONTH- MAINTENANCE COST MACHINE HOURS
January $2,400 300
February 3,000 400
March 3,600 600
April 4,500 790
May 3,200 500
June 4,900 800
Prepare a graph showing the behavior of maintenance costs, and identify the fixed and variable cost elements. Use 200 unit increments and $1,000 cost increments.
The problem deals with determining the fixed and variable cost of a given series of values and also the cost behavior.