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Jonathan Macintosh is a highly successful Pennsylvania orchardman who has formed his own company;to produce and package applesauce. Apples can be stored for several months in cold storage, so applesauce;production is relatively uniform throughout the year. The recently hired controller for the firm is;about to apply the high-low method in estimating the company?s energy cost behavior. The following;costs were incurred during the past 12 months;Month Pints of Applesauce Produced Energy Cost;January................................................................ 35,000.............................................. $23,400;February............................................................... 21,000.............................................. 22,100;March.................................................................. 22,000.............................................. 22,000;April..................................................................... 24,000.............................................. 22,450;May..................................................................... 30,000.............................................. 22,900;June.................................................................... 32,000.............................................. 23,350;July...................................................................... 40,000.............................................. 28,000;August................................................................. 30,000.............................................. 22,800;September............................................................ 30,000.............................................. 23,000;October................................................................ 28,000.............................................. 22,700;November............................................................. 41,000.............................................. 24,100;December............................................................ 39,000.............................................. 24,950;Required;1.;Use the high-low method to estimate the company?s energy cost behavior and express it in;equation form.;2.;Predict the energy cost for a month in which 26,000 pints of applesauce are produced.

 

Paper#75109 | Written in 18-Jul-2015

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