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Angie March owns a catering company that stages banquets and parties for both individuals and companies. The business is seasonal, with heavy demand during the
Angie March owns a catering company that stages banquets and parties for both individuals and companies. The business is seasonal, with heavy demand during the summer months and year-end holidays and light demand at other times. Angie has gathered the following cost information from the past year:
\begin{tabular}{lcc} Month & Labor Hours & Overhead Costs \\ \hline January & 4,000 & $64,000 \\ February & 3,300 & 61,000 \\ March & 3,400 & 62,000 \\ April & 4,500 & 66,000 \\ May & 4,800 & 69,000 \\ June & 6,000 & 73,000 \\ July & 8,300 & 82,000 \\ August & 8,000 & 79,000 \\ September & 6,900 & 74,000 \\ October & 5,000 & 70,000 \\ November & 3,600 & 64,000 \\ December & 7,000 & 75,000 \\ \cline { 2 - 3 } Total & 64,800 & $839,000 \\ \hline \hline \end{tabular} Identify the high and low points. Using the high-low method, compute the overhead cost per labor hour and the fixed overhead cost per month. (Round variable cost to 2 decimal places, e.g. 15.25 and fixed cost to 0 decimal places, e.g. 5,275.) Variablecost =$ per labor hour =$ Angie has booked 4,200 labor hours for the coming month. How much overhead should she expect to incur? Totalcost=$ f Angie books one more catering job for the month, requiring 350 labor hours, how much additional overhead should she expect to incur? Additional overhead =$Step by Step Solution
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