Question
Carmichael Industries is in the process of analyzing its manufacturing overhead costs. Carmichael Industries is not sure if the number of units produced or the
Carmichael Industries is in the process of analyzing its manufacturing overhead costs. Carmichael Industries is not sure if the number of units produced or the number of direct labor (DL) hours is the best cost driver to be used for predicting manufacturing overhead (MOH) costs.
The following information is available:
Month | Manufacturing Overhead Cost | Direct Labor Cost | Units Produced | MOH Cost per DCL Hour | MOH Cost per Unit Produced |
July | $463,000 | 23,100 | 3,620 | $20.04 | $127.90 |
August | 513,000 | 26,500 | 4,300 | 19.36 | 119.30 |
September | 435,000 | 20,000 | 4,230 | 21.75 | 102.84 |
October | 450,000 | 21,400 | 3,380 | 21.03 | 133.14 |
November | 562,000 | 30,000 | 5,790 | 18.73 | 97.06 |
December | 438,000 | 20,500 | 3,300 | 21.37 | 132.73 |
Here is the list of tasks that you need to do in this assessment:
1. Are manufacturing overhead costs fixed, variable, or mixed? Explain.
2. Graph Carmichael Industries
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started