The following information is available regarding the total manufacturing overhead of Bursa Mfg. Co. for a recent

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The following information is available regarding the total manufacturing overhead of Bursa Mfg. Co. for a recent four-month period:
The following information is available regarding the total manufacturing overhead

a. Use the high-low method to determine:
1. The variable element of manufacturing overhead costs per machine-hour.
2. The fixed element of monthly overhead cost.
b. Bursa expects machine-hours in May to equal 4,500. Use the cost relationships determined in part a to forecast May's manufacturing overhead costs.
c. Suppose Bursa had used the cost relationships determined in part a to estimate the total manufacturing overhead expected for the months of February and March. By what amounts would Bursa have over- or underestimated these costs?

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Financial and Managerial Accounting the basis for business decisions

ISBN: 978-0078025778

17th edition

Authors: Jan Williams, Susan Haka, Mark Bettner, Joseph Carcello

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