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Golden Company?s total overhead cost at various levels of activity are presented below: Assume that the overhead cost above consists of utilities, supervisory salaries, and
Golden Company?s total overhead cost at 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 41,000 machine-hour level of activity ?s 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 $231,170 of overhead cost in June was maintenance cost. (Hint: To do this, it may be helpful to first determine how much of the $231,170 consisted of utilities and supervisory salaries. Think about the behavior of variable and fixed costs within the relevant range.) (Do not round intermediate calculations.) Maintenance cost in June $ 2. Using the high-low method, estimate a cost formula for maintenance. (Round the Variable cost per unit to 2 decimal places.) Y $ + $ X
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