Maintenance Expenses of a Company Are to Be Analyzed for Purposes

Multiple Choice

Maintenance expenses of a company are to be analyzed for purposes of constructing a flexible budget. Examination of past records disclosed the following costs and volume measures: $\begin{array}{lrr} & \text { Highest } & \text { Lowest } \\\text { Cost per month } & \$ 86,000 & \$ 74,000 \\\text { Machine hours } & 96,000 & 66,000\end{array}$ Using the high-low technique, estimate the annual fixed cost for maintenance expenditures:

A) $447,400.
B) $368,800.
C) $532,900.
D) $571,200.
E) $218,700.