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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 Month Labor-Hours 720 720 630 275 745 Machine-Hours 1.360 1.406 1,526 1.451 1.600 1.585 1.3 1.313 1.457 1.506 1,286 1,608 Overhead Costs $ 102,736 103,723 109,998 108,203 116.252 114,505 106.919 102,140 100, 113,019 97.595 109,670 730 730 790 685 715 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) Fixed cost Required: o. 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 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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