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Business, 14.05.2021 15:30 jadenhaslam

The controller of the South Charleston plant of Ravinia, Inc., monitored activities associated with materials handling costs. The high and low levels of resource usage occurred in September and March for three different resources associated with materials handling. The number of moves is the driver. The total costs of the three resources and the activity output, as measured by moves for the two different levels, are presented as follows: Resource        Number of Moves        Total Cost
Forklift depreciation:              
Low        5,000                $2,200      
High        16,000                2,200      
Indirect labor:              
Low        5,000                $66,000      
High        16,000                105,600      
Fuel and oil for forklift:              
Low        5,000                $3,550      
High        16,000                11,360

Required:
a. Determine the cost behavior formula of each resource.
b. Using your knowledge of cost behavior, predict the cost of each item for an activity output level of 11,000 moves.
c. Construct a cost formula that can be used to predict the total cost of the three resources combined.

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