Using the High-Low Method, If the Highest Maintenance Cost and Machine

Multiple Choice

Using the high-low method, if the highest maintenance cost and machine hours are $40 000 and 12 000 hours respectively and the lowest maintenance cost and machine hours are $20 000 and 8 000 hours respectively, the variable maintenance costs per machine hour are:

A) $3.33
B) $5.00
C) $2.50
D) $3.00