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Question - Maintenance costs at the Peter Senen Factory are listed below:
Machine Hours
Maintenance cost
January
18,135
P271,920
February
17,940
269,900
March
18,185
272,265
April
18,190
272,455
May
17,860
269,215
June
18,055
270,980
July
18,220
272,750
August
18,045
270,905
September
18,345
273,835
Management believed that the maintenance cost is a mixed cost that depends on machine hours. Using the high low method to estimate the variable and fixed cost, these estimates could be closer to:
a. P9.12 per machine hour; P106,545 per month
b. P15.00 per machine hour; P271,580 per month
c. P0.10 per machine hour; P271,910 per month
d. P9.53 per machine hour; P99,007 per month
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