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Chapter 2. Shelley Company's total overhead costs at various levels of activity are presented below: Total Machine overhead Month Hours Costs March 50,000 $174,000 April
Chapter 2. Shelley Company's total overhead costs at various levels of activity are presented below: Total Machine overhead Month Hours Costs March 50,000 $174,000 April 40,000 $150,200 May 60,000 $197,800 June 70,000 $221,600 Assume that the overhead costs above consist of utilities, supervisory salaries, and maintenance. The breakdown of these costs at the 40,000 machine-hour level of activity is: Utilities (V) $ 40,000 Supervisory salaries (F) $52,000 Maintenance (M) $58,200 Total overhead costs $150,200V = variable; F = fixed; M = mixed. At 70,000 machine hours the total maintenance cost would be: $ 85,866. $ 90,600. $221,600. $ 58,200. $ 99,600
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