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Please do questions 3 and 4 (NOTE : you might have to do questions 1 and 2 to get the response for 3 and 4)
Please do questions 3 and 4 (NOTE : you might have to do questions 1 and 2 to get the response for 3 and 4)
Crosshill Company's total overhead costs at various levels of activity are presented beliow: Assume that the overhead cost above consists of utilities, supervisory salaries, and maintenance. The breakdown of these costs at the 60.000 -machine-hour level of activity in May is as follows: The company wants to break down the maintenance cost into its variable and fived cost elements. Requirod: 1. Estimate how much of the $246,000 of overhead cost in July was maintenance cost. (Hint: To do this, first determine how much of the $246,000 consisted of utilities and supervisory salaries. Think about the behaviour of varlable and flused costs within the relevant range) (Round the "Variable cost per unit" to 2 decimal places.) 2. Using the high-low method, estimate a cost formula for maintenance. (Round the "Variable cost per unit" to 2 decimal places.) 3. Express the company's total overhead cost in the form Y=a+bX (Round the "Variable cost per unit" to 2 decimal places.) 4. What total overhead cost would you expect to be incurred at an activity level of 75,000 machine-hours? (Round the "Variable cost per unit" to 2 decimal places.)Step by Step Solution
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