Cost behavior analysis; utility of cost behavior information. Tastee-Treat Food Company assigns factory overhead by a predetermined rate on the basis of direct labor hours. Factory overhead costs for two recent years, adjusted for changes using current prices and wage rates, are as follows:

Year 1 Year 2 Direct labor hours worked. 2,760,000 2,160,000 Factory overhead costs: Indirect labor . . . .. $11,040,000 $ 8,640,000 Employee benefits . . . . 4,140,000 3,240,000 Supplies . . . . . 2,760,000 2,160,000 Power . . . . . 2,208,000 1,728,000 Heat and light . . 552,000 552,000 Supervision . . . . . . . 2,865,000 2,625,000 Depreciation. . . . . 7,930,000 7,930,000 Property taxes and insurance . . . . 3,005,000 3,005,000 Total factory overhead cost . . . .. $34,500,000 $29,880,000