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Swanson and Associates presently leases a copy machine under an agreement that calls for a fixed fee each month and a charge for each copy made. Swanson made 7,000 copies and paid a total of $360 in March; in May, the firm paid $280 for 5,000 copies. The company uses the high-low method to analyze costs.
1. Swanson’s variable cost per copy is:
A. $0.040.
B. $0.051.
C. $0.053.
D. $0.056.
E. an amount other than those given above.
Answer: A
2. Swanson’s monthly fixed fee is:
A. $80.
B. $102.
C. $106.
D. $112.
E. an amount other than those given above.
Answer: A
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