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3. What total factory overhead costs would you expect the company to incur at an operating level of 66,000 direct labor-hours? (Do not round intermediate
3. What total factory overhead costs would you expect the company to incur at an operating level of 66,000 direct labor-hours? (Do not round intermediate calculations.) Total factory overhead costUsing the high-low method, estimate a cost formula for maintenance. (Do not round intermediate calculations.)Sawaya Co., or Japan is a manufacturing company whose total factory overhead costs fluctuate considerably from year to year according to increases and decreases in the number of direct labor-hours worked in the factory. Total factory overhead costs at high and low levels of activity for recent years are given below: Level of Activity Low High Direct labor-hours 60,000 80,000 Total factory overhead costs $ 292,300 $ 334,300 The factory overhead costs above consist of indirect materials, rent, and maintenance. The company has analyzed these costs at the 60,000-hour level of activity as follows: . . . 108,000 Indirect materials (variable) $ Rent (fixed) 132,000 Maintenance (mixed) 52,300 292,300 Total factory overhead costs $ To have data available for planning, the company wants to break down the maintenance cost into its variable and fixed cost elements. Required: 1. Estimate how much of the $334,300 factory overhead cost at the high level of activity consists of maintenance cost. (Hint: To do this, it may be helpful to first determine how much of the $334,300 consists of indirect materials and rent. Think about the behavior of variable and fixed costs!) (Do not round intermediate calculations.) Maintenance cost at high level of activity
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