Question
Brimfield Catering uses thehigh-low method to predict its total overhead costs. Past records show that total overhead cost was $25,600 when 860 hours were worked
Brimfield Catering uses thehigh-low method to predict its total overhead costs. Past records show that total overhead cost was $25,600 when 860 hours were worked and $27,800 when 960 hours were worked. If brimfield catering has 885 hours scheduled for next month,
what is the expected total overhead cost for nextmonth?
Use thehigh-low method to determine the variable and fixed costs components of Brimfield
1.) Brimfield Catering's operating cost equation:
2.)Next identify the formula and compute the fixed cost component(the verticalintercept) using the costs for the highest level of activity.
3.) complete Brimfield Caterings's operating cost equation.
y+$______ x + $ ______
4.)If Brimfield Catering has 885 hours scheduled nextmonth, what is the expected total overheadcost?
The total monthly operating costs if Brimfield Catering works 885 labor hours is $_______
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