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The document presents five problems related to estimating utility, maintenance, electricity, factory supplies, and indirect labor costs using the High-Low Method. Each problem includes data on machine hours and corresponding costs, along with specific questions to determine variable costs, total fixed costs, cost formulas, and cost estimates for given machine hours. The problems are structured for educational purposes, ensuring whole-number answers suitable for quizzes and exams.

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Marrish Magboo
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3 views4 pages

Untitled document.docx

The document presents five problems related to estimating utility, maintenance, electricity, factory supplies, and indirect labor costs using the High-Low Method. Each problem includes data on machine hours and corresponding costs, along with specific questions to determine variable costs, total fixed costs, cost formulas, and cost estimates for given machine hours. The problems are structured for educational purposes, ensuring whole-number answers suitable for quizzes and exams.

Uploaded by

Marrish Magboo
Copyright
© All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd

Problem 1 – Utility Cost

ABC Manufacturing wants to estimate its utility cost using the High-Low Method.

Month Machine Hours Utility Cost

January 15,000 ₱85,000

February 16,000 ₱89,000

March 17,000 ₱93,000

April 18,000 ₱97,000

May 19,000 ₱101,000

June 20,000 ₱105,000

Questions

1. Determine the variable cost per machine hour.


2. Determine the total fixed cost.
3. Write the cost formula.
4. Estimate the utility cost if machine hours are 21,000.
5. Estimate the utility cost if machine hours are 18,500.

Problem 2 – Maintenance Cost


Month Machine Hours Maintenance Cost

July 22,000 ₱100,000

August 23,000 ₱105,000

September 24,000 ₱110,000

October 25,000 ₱115,000

November 26,000 ₱120,000


December 27,000 ₱125,000

Questions

1. Determine the variable cost per machine hour.


2. Determine the total fixed cost.
3. Write the cost formula.
4. Estimate the maintenance cost at 28,000 machine hours.
5. Estimate the maintenance cost at 24,500 machine hours.

Problem 3 – Electricity Cost


Month Machine Hours Electricity Cost

January 12,000 ₱72,000

February 13,000 ₱76,000

March 14,000 ₱80,000

April 15,000 ₱84,000

May 16,000 ₱88,000

June 17,000 ₱92,000

Questions

1. Determine the variable cost per machine hour.


2. Determine the total fixed cost.
3. Write the cost formula.
4. Estimate the electricity cost at 18,000 machine hours.
5. Estimate the electricity cost at 15,500 machine hours.

Problem 4 – Factory Supplies Cost


Month Machine Hours Factory Supplies Cost

July 10,000 ₱50,000


August 11,000 ₱55,000

September 12,000 ₱60,000

October 13,000 ₱65,000

November 14,000 ₱70,000

December 15,000 ₱75,000

Questions

1. Determine the variable cost per machine hour.


2. Determine the total fixed cost.
3. Write the cost formula.
4. Estimate the factory supplies cost at 16,000 machine hours.
5. Estimate the factory supplies cost at 13,500 machine hours.

Problem 5 – Indirect Labor Cost


Month Machine Hours Indirect Labor Cost

January 25,000 ₱150,000

February 26,000 ₱155,000

March 27,000 ₱160,000

April 28,000 ₱165,000

May 29,000 ₱170,000

June 30,000 ₱175,000

Questions

1. Determine the variable cost per machine hour.


2. Determine the total fixed cost.
3. Write the cost formula.
4. Estimate the indirect labor cost at 31,000 machine hours.
5. Estimate the indirect labor cost at 28,500 machine hours.

These are balanced textbook-style problems where:


● Highest machine hours = Highest cost
● Lowest machine hours = Lowest cost
● The computations give whole-number answers, making them ideal for quizzes and
exams.

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