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Please show how you arrived at all answers through Excel. Please assist with formulas where possible. Nova Company's total overhead cost at various levels of
Please show how you arrived at all answers through Excel. Please assist with formulas where possible.
Nova Company's total overhead cost at various levels of activity are presented below: Total Overhoad Cost Month April June Ma 70,000 60,000 80,000 90,000 $198,000 $174,000 $222,000 $246,000 Assume that the total overhead cost above consists of utilities, supervisory salaries, and main- tenance. The breakdown of these costs at the 60,000 machine-hour level of activity is: Utilities (varlable) Supervisory salaries (flxed).. Malntenance (mixed) 48,000 21,000 105,000 $174,000 . . Nova Company's management wants to break down the maintenance cost into its variable and fixed cost elements. Required: Estimate how much of the $246,000 of overhead cost in July was maintenance cost. (Hint: to do this, it may be helpful to first determine how much of the $246,000 consisted of utilities and supervisory salaries. Think about the behavior of variable and fixed costs!) 2. Using the high-low method, estimate a cost formula for maintenance. 3. Express the company's total overhead cost in the linear equation form Y-a + bX. 4. What total overhead cost would you expect to be incurred at an activity level of 75,000Step by Step Solution
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