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- February 4, 2019 at 10:14 am #504106
The following table shows the total overheads for a company over the last month of units produced in each month:
Month Number of units Total Overheads
1 19.200 885.120
2 22.080 960.000
3 21.600 936.000
4 21.120 956.160
5 20.160 883.200Applying the High and Low method to the above information, which of the following equation could be used to forecast the total overheads from the numbers of units produced?
Why the answer is 385 920 +26x and not 76800+40x?
Thanks in advance Mr John Mofft
February 4, 2019 at 9:35 pm #504197Because we take the highest units and the lowest units (the independent variables) for the calculation, and so we use the figures from month 2 and month 1 to do the workings.
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