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Super Rat Machine Works, a manufacturing firm, manufactures sprockets for the Tree Bicycle company. The company has supplied information from its accounting records for the
Super Rat Machine Works, a manufacturing firm, manufactures sprockets for the Tree Bicycle company. The company has supplied information from its accounting records for the last four months.
January | February | March | April | |
Number of sprockets manufactured | 10,000 | 12,000 | 8,800 | 11,500 |
Factory overhead | January | February | March | April |
Factory supervision wages | $ 37,800 | $ 37,800 | $ 37,800 | $ 37,800 |
Factory rent | 21,600 | 21,600 | 21,600 | 21,600 |
Utilities (electricity/water) | 18,000 | 19,800 | 16,280 | 20,000 |
Factory repairs & maintenance | 14,000 | 15,360 | 13,728 | 15,525 |
CNC machine tool sharpening | 3,000 | 3,600 | 2,640 | 3,450 |
CNC machine depreciation | 15,000 | 15,000 | 15,000 | 15,000 |
Total factory overhead | $ 109,400 | $ 113,160 | $ 107,048 | $ 113,375 |
Classify each factory overhead costs as fixed, variable or mixed, using number of sprockets manufactured as the activity driver (also called the cost driver).
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