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Question(s) / Instruction(s):

Maintenance costs at a Neller Corporation factory are listed below:

                                Machine-Hours                 Maintenance Cost

 February             2,899                                     $27,940

 March                  2,909                                     $28,200

 April                      2,883                                     $27,830

 May                      2,922                                     $28,345

 June                     3,054                                     $28,830

 July                       2,935                                     $28,492

 August                 2,959                                     $28,600

 September        2,961                                     $28,770

 October              2,908                                     $28,782

Management believes that maintenance cost is a mixed cost that depends on machine-hours. Using the high-low method to estimate the variable and fixed components of this cost, these estimates would be closest to (Round the variable cost element to two decimal places and the fixed cost element to the nearest whole number.):

A.            $.42 per machine-hour; $21,387 per month

B.            $5.85 per machine-hour; $10,964 per month

C.            $14.07 per machine-hour; $22,078 per month

D.            $2.88 per machine-hour; $16,641 per month

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