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Problem 6-41 Work Measurement; Cost Estimation with Different Methods; Wholesaler (LO 6-1, 6-2, 6-5, 6-6) Martha's Vineyard Marine Supply is a wholesaler for a
Problem 6-41 Work Measurement; Cost Estimation with Different Methods; Wholesaler (LO 6-1, 6-2, 6-5, 6-6) Martha's Vineyard Marine Supply is a wholesaler for a large variety of boating and fishing equipment. The company's controller, Mathew Knight, has recently completed a cost study of the firm's material-handling department in which he used work measurement to quantify the department's activity. The control factor unit used in the work- measurement study was hundreds of pounds of equipment unloaded or loaded at the company's loading dock. Knight compiled the following data. Units of Activity (hundreds of pounds of equipment loaded or unloaded) Material-Handling Department Costs Month January February 1,600 $14,470 1,400 14,310 March 1,300 13,930 April 2,800 16,200 May 2,000 14,840 June 2,200 15,600 July 2,600 16,470 August 2,400 14,860 September 1,200 13,000 October 1,500 14,290 November December 1,800 2,000 14,580 15,140 Required: 5. Estimate the material-handling department's cost behavior using the high-low method. Use an equation to express the results of this estimation method. (Round coefficient of X to 2 decimal places.) Material-handling cost per month = X
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