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Crosshill Company's total overhead conts of various levels of activity are presented below. Assume that the overhead cost above consists of utilities, supervisory salaries, and
Crosshill Company's total overhead conts of various levels of activity are presented below. Assume that the overhead cost above consists of utilities, supervisory salaries, and maintenance. The breakdown of these costs at the 60,000 -machine-hour level of activity in May is as follows: The company wants to break down the maintenance cost into its variable and fixed cost elements: Required: 1. Estimate how much of the $246,000 of overhead cost in July was maintenance cost. (Hint To do this, first determine how much o the $246,000 consisted of utilities and supervisory salaries. Think about the behaviour of varlable and fixed costs within the releva range.) (Round the "Variable cost per unit" to 2 decimal places.) Hequired: 1. Estimate how much of the $246,000 of overhead cost in July was maintenance cost. (Hint. To do this, firmt determine how much of the $246,000 consisted of utilities and supervisory salaries. Think about the behaviour of variabie and finced costs within the ieleviant range) (Round the "Variable cost per unit" to 2 decimal places.) 2. Using the high-low method, estimate a cost formula for maintenance. (Round the "Variable cost per unit" to 2 decimal places. 3. Express the company's total overhead cost in the form Y=a+bX (Round the "Variable cost per unit" to 2 decimal piac 4. What total overhead cost would you expect to be incurred ot an activity level of 75,000 machine-hours? (Round the "Variable cost per unit" to 2 decimal places.)
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