Reference no: EM132516643

Margolo Company makes cross-country skis. The company controller wants to calculate the fixed and variable costs associated with janitorial services incurred by the factory. Data for the past six months were collected.

                     Janitorial                   Labor

Mouth                 Cost                     Hours

January            $9,200               10,120

February            8,800               9,500

March                 9,350              10,500

April                   9,620              11,100

May                   8,400               8,660

June                     9,400           10,650

Required:

Question 1: Using the high-low method compute the variable rate of the janitorial cost.

Question 2: Using the high-low method compute the fixed cost of janitorial services.

Question 3: Compute the estimated janitorial cost to be incurred during the next six months assuming that 58,200 labor hours will be worked.