sawaya co. ltd

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 250,000 -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 13,575,000 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 13.575.000 consists of indirect materials and rent. Think about the behaviour of variable and fixed costs!) 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 250,000 -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 13,575,000 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 13.575.000 consists of indirect materials and rent. Think about the behaviour of variable and fixed costs!)