High-Low and Cost Formula Harrison Company has accumulated the following total manufactur-

ing overhead costs for two levels of activity (within the relevant range):

LowHigh

Activity (direct labor hours).......................................... 80,000 120,000

Total manufacturing overhead .......................................$468,000 $604,000

The total overhead cost includes variable, fixed, and mixed costs. At 120,000 direct labor hours, the

total cost breakdown is as follows:

Variable cost...............................................................$264,000

Fixed cost................................................................. 160,000

Semi-mixed cost ........................................................... 180,000

Required

a . Using the high-low method of cost analysis, determine the variable portion of the semi-variable

cost per direct labor hour. Determine the total fixed cost component of the mixed cost.

b. What should the total planned overhead cost be at 100,000 direct labor hours?