Question
Dundar Mifflin makes electronic products for the RCMP. The following data is for the first six months: Direct Labor Hours Manufacturing Overhead January 45,000 $295,000
Dundar Mifflin makes electronic products for the RCMP. The following data is for the first six months:
|
| Direct Labor Hours | Manufacturing Overhead |
| January | 45,000 | $295,000 |
| February | 59,900 | $307,575 |
| March | 57,000 | $323,000 |
| April | 58,000 | $320,000 |
| May | 27,800 | $158,600 |
| June | 29,000 | $152,500 |
Required:
- Use the high-low method to estimate the cost formula (3 marks)
- Estimate the total overhead cost at an activity level of 432000 machine hours, using the separate estimates you obtained for its components. (2 marks)
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Modern Auditing
Authors: Guadarshan S. Gill, Cosserat Graham, Leung Philomena, Coram Paul
5th Edition
0471340723, 978-0471340720
