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Adriana Corporation manufactures football equipment. In planning for next year, the managers want to understand the relation between activity and overhead costs. Discussions with the
Adriana Corporation manufactures football equipment. In planning for next year, the managers want to understand the relation between activity and overhead costs. Discussions with the plant supervisor suggest that overhead seems to vary with labor-hours, machine-hours, or both. The following data were collected from last year's operations. Honth 1 2 3 4 5 6 7 8 9 le 11 12 Labor-Hours 730 7e5 690 745 775 760 740 720 Machine-Hours 1,345 1.419 1,526 1.461 1,586 1,583 1,395 1,306 1,444 1,542 1,292 1,614 Overhead Costs $ 182,714 103,749 109,819 188,309 116,256 114,522 106,988 102,087 106,350 113,143 101,708 115,071 705 800 665 710 Required: a. Use the high-low method to estimate the fixed and variable portions of overhead costs based on machine-hours. b. Managers expect the plant to operate at a monthly average of 1,600 machine-hours next year. What are the estimated monthly overhead costs, assuming no inflation? Complete this question by entering your answers in the tabs below. Required A Required B Use the high-low method to estimate the fixed and variable portions of overhead costs based on machine-hours. (Round "Variable cost" answer to 2 decimal places.) Variable cost (per machine hour) Fbced cost Required Required B > Adriana Corporation manufactures football equipment. In planning for next year, the managers want to understand the relation between activity and overhead costs. Discussions with the plant supervisor suggest that overhead seems to vary with labor-hours, machine-hours, or both. The following data were collected from last year's operations, Labor. Hours 730 70s 690 745 775 Month 1 2 3 4 5 6 2 8 9 le 11 12 760 740 720 705 809 665 710 Machine-Hours 1,345 1,419 1,526 1,461 1,586 1,583 1,395 1,306 1,444 1,542 1, 292 1,614 Overhead Costs $ 102,714 103,749 109,819 108, 309 116, 256 114,522 106,900 102,607 106,350 113,143 101,700 115,071 Required: a. Use the high-low method to estimate the fixed and variable portions of overhead costs based on machine hours. b. Managers expect the plant to operate at a monthly average of 1600 machine hours next year. What are the estimated monthly overhead costs, assuming no inflation? Complete this question by entering your answers in the tabs below. Required A Required B Managers expect the plant to operate at a monthly average of 1,600 machine-hours next year. What are the estimated monthly overhead costs, assuming no Inflation? Overhead costs
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