1)Assume a company had no jobs in progress at the beginning of July and no beginning inventories. It started and completed only two jobs during JulyJob Y and Job Z. The company uses a plantwide predetermined overhead rate based on direct labor-hours. The following additional information from the month of July is available for the company as a whole and for Jobs Y and Z:

Estimated total fixed manufacturing overhead	$ 13,000
Estimated variable manufacturing overhead per direct labor-hour	$ 1.00
Estimated total direct labor hours to be worked	2,000
Total actual manufacturing overhead costs incurred	$ 12,800

	Job Y	Job Z
Direct materials	$ 13,000	$ 8,000
Direct labor cost	$ 21,000	$ 7,500
Actual direct labor hours worked	1,400	?

Assuming Job Z's total job cost is $19,250, how many direct labor hours were actually worked on Job Z?

Multiple Choice

• 575
• 500
• 600
• 525

2)In describing the cost formula equation, Y = a + bX, which of the following is correct:

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Multiple Choice

• in the high-low method, "b" equals the change in cost divided by the change in activity.
• "Y" is the independent variable.
• "a" and "b" are valid for all levels of activity.
• "a" is the variable cost per unit.