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The CW89481 company uses direct labor-hours as its activity measure for overhead cost. Shown below are direct labor-hours and total overhead costs for the first
The CW89481 company uses direct labor-hours as its activity measure for overhead cost. Shown below are direct labor-hours and total overhead costs for the first half of the year:
Direct labor-Hours | Overhead Cost | |||||
Jan | 150,000 | $ | 339,000 | |||
Feb | 140,000 | $ | 328,000 | |||
Mar | 160,000 | $ | 350,000 | |||
Apr | 120,000 | $ | 296,000 | |||
May | 170,000 | $ | 362,500 | |||
Jun | 200,000 | $ | 400,000 | |||
Assume that the relevant range includes all of the activity levels for the CW89481 company given in this problem.
If CW89481 expects to incur 192,000 direct labor hours next month, what will the estimated total overhead cost be using the high-low method? (Round your intermediate calculations to 2 decimal places.)
Multiple Choice
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$390,100
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$388,600
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$390,800
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$389,600
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