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 labor-hours worked in the factory. Total factory overhead costs at high and low levels of activity for recent years are given below: Level of Activity Low High 74,100 98,800 $278,760 $318,280 Direct labor-hours Total factory overhead costs The factory overhead costs above consist of indirect materials, rent, and maintenance. The company has analyzed these costs at the 74,100-hour level of activity as follows: Indirect materials (variable) Rent (fixed) Maintenance (mixed) $ 81,510 128,000 69,250 Total factory overhead costs $ 278,760 To have data available for planning, the company wants to break down the maintenance cost into its variable and fixed cost elements. To have data available for planning, the company wants to break down the maintenance cost into its variable and fixed cost elements. Required: 1. Estimate how much of the $318,280 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 $318,280 consists of indirect materials and rent. Think about the behavior of variable and fixed costs!) (Do not round intermediate calculations.) Maintenance cost at high level of activity 2. Using the high-low method, estimate a cost formula for maintenance. (Do not round intermediate calculations. Round "Variable cost element" to 2 decimal places.) High level of activity Low level of activity Change Direct Labor- Maintenance Hours Cost 98,800 74,100 24,700 $ 0 per DLH Variable cost element Fixed cost element Y = + X