Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Sawaya Co., Ltd, of Japan, is a manufacturing company whose total factory overhead costs fluctuate considerably from year to year according to increases and decreases

image text in transcribed
image text in transcribed
Sawaya Co., Ltd, of Japan, is a manufacturing company whose total factory overhead costs fluctuate considerably from year to year according to increases and decreases in the number of direct labour hours worked in the factory. Total factory overhead costs (in Japanese yen, denoted ) at high and low levels of activity for recent years are provided below: The factory overhead costs above consist of indirect materials, rent, and maintenance. The company has analyzed these costs at the 190,000 hour level of activity as follows: V= variable; F= fixed, M= mixed. To have data available for planning, the company wants to break the maintenance cost down into its variable and fixed cost elements. Required: 1. Estimate how much of the 14,311,000 factory overhead cost at the high level of activity consists of maintenance cost. (Hint: To do this, it may be helpful to first determine how much of the 714,311,000 consists of indirect materials and rent. Think about the behaviour of variable and fixed costs!) Sawaya Co4 Ltd., of Japan, is a manufacturing company whose total factory overhead costs fluctuate considerably from year to year according to increases and decreases in the number of direct labour-hours worked in the factory. Total factory overhead costs (in Japanese yen, denoted Y ) at high and low levels of activity for recent years are provided below: The factory overhead costs above consist of indirect materials, rent, and maintenance. The compary has analyzed these costs at the 190,000 hour level of activity as follows; V= variable; F= fixed, M=mixed To have data avallable for planning, the company wants to break the maintenance cost down into its variable and fixed cost elements. Required: 1. Estimate how much of the 14,311,000 factory overhead cost at the high level of activity consists of maintenance cost. (Hint: To do this, it may be helpful to first determine how much of the 14,311,000 consists of indirect materials and rent. Think about the behaviour of variable and fixed costs!)

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Managerial Accounting Information For Decisions

Authors: Thomas L. Albright , Robert W. Ingram, John S. Hill

4th Edition

0324222432, 978-0324222432

More Books

Students also viewed these Accounting questions

Question

2. Recognize students who are helpful.

Answered: 1 week ago