Asper Company has recently introduced budgeting as an integral part of its corporate planning process An inexperienced member of the accounting staff was given the assignment of constructing a flexible budget for manufacturing overhead costs and prepared it in the format that follows Percentage of Canadity DOR 54,400 100 68,000 Maschinehours Utilities Supplies Indirect labour Maintenance Supervision $ 42,00 16,320 21,760 53,640 25,000 $ 51,600 20,400 27,200 61,00 20,000 Total manufacturing overhead cost $ 161,600 $ 189,000 The company assigns manufacturing overhead costs to production on the basis of standard machine-hours. The cost formulas used to prepare the budgeted figures above are relevant over a range of 80% to 100% of capacity in a month. The managers who will be working under these budgets have control over both fixed and variable manufacturing overhead costs Required: 1. Use the high-low method to separate fixed and variable costs. (Round variable cost answers to 2 decimal places.) Required: 1. Use the high-low method to separate fixed and variable costs. (Round variable cost answers to 2 decimal places.) Variable Component Fixed Component Overhead Item Utilities Supplies Indirect labour Maintenance Supervision Totals 2. Come up with a single cost formula for all overhead costs based on your analysis in requirement above. (Hint Your cost formula should be of the form y=a + bx) (Round variable cost answer to 2 decimal places.) 3. During May, the company operated at 85% of machine hour capacity. Actual manufacturing overhead costs incurred during the month were as follows Utilities Supplies Indirect labour Maintenance Supervision $43,620 10 23,050 51.450 21,000 Total actual manufacturing overhead cost $165,490 Fixed costs had no budget variances. Prepare an overhead performance report for May Include both fixed and variable costs in your report in separate sections), Structure your report so that it shows only a spending variance for variable overhead The company originally budgeted to work 54,400 machine hours during the month standard hours allowed for the month's production totalled 55,400 machine hours (indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None' for no effect (ie zero variance). Round "Cost Formula per MH" answers to 2 decimal places.) Overhead Costs Cost Formula per MH Actual Cost 57.800 MH Flexible Budget 57,000 MH Spending Variance Variable overhead costs Total variable overhead cost Fixed overhead costs Total fixed overhead cost Total overhead cost