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Crosshill Company's total overhead costs at various levels of activity are presented below: Machine- Total Overhead Month Hours Cost April May June July 45,000
Crosshill Company's total overhead costs at various levels of activity are presented below: Machine- Total Overhead Month Hours Cost April May June July 45,000 $184,750 35,000 $158,050 55,000 $211,450 65,000 $238,150 Assume that the overhead cost above consists of utilities, supervisory salaries, and maintenance. The breakdown of these costs at the 35,000-machine-hour level of activity in May is as follows: Utilities (variable) Supervisory salaries (fixed) Maintenance (mixed) Total overhead cost $ 52,500 52,000 53,550 $ 158,050 The company wants to break down the maintenance cost into its variable and fixed cost elements. Required: 1. Estimate how much of the $238,150 of overhead cost in July was maintenance cost. (Hint: To do this, first determine how much of the $238,150 consisted of utilities and supervisory salaries. Think about the behaviour of variable and fixed costs within the relevant range.) (Do not round intermediate calculations.) Maintenance cost in July
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