Carmichael Industries is in the process of analyzing its manufacturing overhead costs. Carmichael Industries is not the following information is available: : sure if the number of units produced or number of direct labour hours is the best cost driver to use for predicting manufacturing overhead costs Click the icon to view the information. Requirements Requirement 1. Determine if the manufacturing overhead costs are fixed, variable, or mixed? Carmichael's manufacturing overhead appears to be a y cost. If it were a cost it would remain constant in total each month. If it were a Both Carmichael's MOH per DL hour and MOH per unit with volume. fixed cost, it would remain constant on a per unit (of activity) basis mixod 0 Data Table variablo - 0 Requirements MOH Manufacturing Direct Cost per MOH Cost per Unit Overhead Labour Units DL 1. Are manufacturing overhead costs fixed, variable, or mixed? Explain. 2. Graph Cammichael Industries' MOH costs against DL hours. 3. Graph Carmichael Industries' MOH costs against units produced 4. Does the data appear to be sound, or do you see any potential data problerris? Explain. 5. Use the high-low method to determine Carmichael Industries' MOH cost equation using DL hours as the cost driver. Assume that management believes that all data are accurate and wants to include all of it in the analysis 6. Estimate MOH costs if Carmichael Industries incurs 26,000 DL hours in January Month Costs Hours Produced Hour Produced 460.000 23,000 20.00 $ 127.78 July .....S S August September 3,600 $ 4,320 515 000 19.51 26,400 19.000 119.21 101.19 4.200 2237 425.000 448.000 21,600 3.400 20.74 131.76 Print Done October ... November ... December 527.000 27.000 5,750 19.52 91.65 437,000 19,400 3250 22.53 134.46 Print Done Carmichael Industries is in the process of analyzing its manufacturing overhead costs. Carmichael Industries is not the following information is available: sure if the number of units produced or number of direct labour hours is the best cost driver to use for predicting (Click the icon to view the information.) manufacturing overhead costs Requirements Requirement 1. Determine if the manufacturing overhead costs are fixed, variable, or mixed? Carmichael's manufacturing overhead appears to be a y cost. If it were a cost, it would remain constant in total each month. If it were a Both Carmichael's MOH per DL hour and MOH per unit with volume cost, it would remain constant on a per unit (of activity) basis. are fixed vary i Data Table MOH MOH Manufacturing Direct Cost per Cost per Overhead Labour Units DL Unit Month Costs Hours Hour Produced Produced 3,600 S 20.00 S 127.78 460,000 515,000 23,000 26,400 4,320 19.51 119.21 July ........ $ August ....... September October November 425,000 19,000 21,600 4,200 3,400 22.37 20.74 101.19 131.76 448,000 527,000 27,000 5,750 19.52 91.65 December 437,000 19,400 3,250 22.53 134.46 Print Done
