I need assistance on how to work these problems. Please assist in answering the attached problems.
Willco Inc. manufactures electronic parts. They are analyzing their monthly maintenance costs to determine the best way to budget these costs in the future. They have collected the following data for the last six months: 1) Using the high-low method and the Willco data, calculate the variable maintenance cost per machine hour (round to three decimal places). A. $1.016/hr. B. $0.976/hr. C. $1.863/hr. D. $1.250/hr. E. $0.907/hr. 2) Using the high-low method and the Willco data above, what is the approximate fixed cost component of the monthly maintenance costs? A. $33,860 B. $24,500 C. $32,755 D. $32,715 E. $30,686 3) If Wilco Inc. expects to operate the machines for a total of 32,000 hours in the next month, calculate the expected maintenance costs. A. $31,232 B. $32,512 C. $64,755 D. $63,947 E. $65,227 4) If a firm's forecasted sales are $250,000 and its break-even sales are $190,000, the margin of safety (in dollars) is: A. $60,000 B. $250,000 C. $190,000 D. $440,000 E. $24,000 Willco Inc. manufactures electronic parts. They are analyzing their monthly maintenance costs to determine the best way to budget these costs in the future. They have collected the following data for the last six months: 1) Using the high-low method and the Willco data, calculate the variable maintenance cost per machine hour (round to three decimal places). A. $1.016/hr. B. $0.976/hr. C. $1.863/hr. D. $1.250/hr. E. $0.907/hr. Solution May 42,300 $74,000 January 30,000 $62,000 Difference 12,300 $12,000 Variable cost = 12,000/12,300 Variable cost = 12,000/12,300 Variable cost = 0.976 2) Using the high-low method and the Willco data above, what is the approximate fixed cost component of the monthly maintenance costs? A. $33,860 B. $24,500 C. $32,755 D. $32,715 E. $30,686 Fixed cost = 62000-0.976*30000 Fixed cost = 62000-0.976*30000 Fixed cost = 32720 but near to 32,715 so selected D 3) If Wilco Inc. expects to operate the machines for a total of 32,000 hours in the next month, calculate the expected maintenance costs. A. $31,232 B. $32,512 C. $64,755 D. $63,947 E. $65,227 Solution: Total cost = 32000*0.976+32715 Total cost = $63,947 4) If a firm's forecasted sales are $250,000 and its break-even sales are $190,000, the margin of safety (in dollars) is: A. $60,000 B. $250,000 C. $190,000 D. $440,000 E. $24,000 Margin of safety = sales - BEP Sales Margin of safety = 250,000 - 190,000 Margin of safety = 60,000 Willco Inc. manufactures electronic parts. They are analyzing their monthly maintenance costs to determine the best way to budget these costs in the future. They have collected the following data for the last six months: 1) Using the high-low method and the Willco data, calculate the variable maintenance cost per machine hour (round to three decimal places). A. $1.016/hr. B. $0.976/hr. C. $1.863/hr. D. $1.250/hr. E. $0.907/hr. Solution May 42,300 $74,000 January 30,000 $62,000 Difference 12,300 $12,000 Variable cost = 12,000/12,300 Variable cost = 12,000/12,300 Variable cost = 0.976 2) Using the high-low method and the Willco data above, what is the approximate fixed cost component of the monthly maintenance costs? A. $33,860 B. $24,500 C. $32,755 D. $32,715 E. $30,686 Fixed cost = 62000-0.976*30000 Fixed cost = 62000-0.976*30000 Fixed cost = 32720 but near to 32,715 so selected D 3) If Wilco Inc. expects to operate the machines for a total of 32,000 hours in the next month, calculate the expected maintenance costs. A. $31,232 B. $32,512 C. $64,755 D. $63,947 E. $65,227 Solution: Total cost = 32000*0.976+32715 Total cost = $63,947 4) If a firm's forecasted sales are $250,000 and its break-even sales are $190,000, the margin of safety (in dollars) is: A. $60,000 B. $250,000 C. $190,000 D. $440,000 E. $24,000 Margin of safety = sales - BEP Sales Margin of safety = 250,000 - 190,000 Margin of safety = 60,000
