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rosshill Company's total overhead costs at various levels of activity are presented below: Total Overhead Month MachineHours Cost April ?6,666 $262,666 May 66,666 $186,666 June
rosshill Company's total overhead costs at various levels of activity are presented below: Total Overhead Month MachineHours Cost April ?6,666 $262,666 May 66,666 $186,666 June 66,666 $224,666 July 96,666 $246,666 ssume that the overhead cost above consists of utilities, supervisory salaries, and maintenance. The breakdown of these costs at the 0.000machinehour level ofactivity in May is as follows: Utilities (variable) $ 49,866 Supervisory salaries (fixed) 21,666 Maintenance (mixed) 169,266 Total overhead cost $186,666 he company wants to break down the maintenance cost into its variable and fixed cost elements. equired: . Estimate how much of the $246,000 of overhead cost in July was maintenance cost. (Hint: To do this, first determine how much of he $246,000 consisted of utilities and supervisory salaries. Think about the behaviour ofvariable and fixed costs within the relevant ange.) (Round the "Variable cost per unit" to 2 decimal places.) _:I Using the highlow method, estimate a cost formula for maintenance. (Round the "Variable cost per unit" to 2 decimal place-5.} High activity level Low activity level Variable cost element Fixed cost element . Express the company's total overhead cost in the form Y = a + bX. (Round the "Variable cost per unit" to 2 decimal places.) Utilrties cost Supervrsory salarres cost Maintenance cost Total overhead cost . What total overhead cost would you expect to be incurred at an activity level of 75,000 machinehours? {Round the "Variable cost er unit" to 2 decimal places.) _:|
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