The following data pertains to activity and maintenance cost for two recent periods: Activity level (units) 8,000 7,000Maintenance cost$34,000 $31,500 Maintenance cost is a mixed cost with both fixed and variable components. Using the high-low method, the cost formula for maintenance cost is:
A. Y = $14,000 + $2.50 X
B. Y = $4.50 X
C. Y = $2,500 + $4.25 X
D. Y = $4.25 X
Answer: A
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