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A cost analyst collected the following information for the Machining Department:
Machine-hours
July 8,000 $60,000
August 9,200 66,000
September 7,600 61,000
October 8,800 64,000
November 9,000 65,000
Required:
Problem 1: Determine the estimated cost function with machine-hours as the cost driver using the high-low method.
Problem 2: If December's estimated machine-hours total 8,400, what is the estimated cost of the Machining Department?
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