Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

The following selected data were taken from the accounting records of Metcalf Manufacturing. The company uses direct-labor hours as its cost driver for overhead costs.

The following selected data were taken from the accounting records of Metcalf Manufacturing. The company uses direct-labor hours as its cost driver for overhead costs.

MonthDirect-Labor HoursManufacturing OverheadJanuary 30,000 $694,000 February 32,000 733,000 March 42,000 892,000 April 33,000 752,500 May 37,000 795,000 June 35,000 792,000

Marchs costs consisted of machine supplies ($210,000), depreciation ($29,000), and plant maintenance ($653,000). These costs exhibit the following respective behavior: variable, fixed, and semivariable. The manufacturing overhead figures presented in the preceding table do not include Metcalfs supervisory labor cost, which is step-fixed in nature. For volume levels of less than 15,000 hours, supervisory labor amounts to $74,000. The cost is $148,000 from 15,00029,999 hours and $222,000 when activity reaches 30,000 hours or more. 1. Determine the machine supplies cost and depreciation for January. (Do not round your intermediate values.)

Machine supplies cost Depreciation

2. Using the high-low method, analyze Metcalfs plant maintenance cost and calculate the monthly fixed portion and the variable cost per direct-labor hour. (Round your "Variable cost per hour" answer to 2 decimal places.)

Variable cost per hour Fixed cost per month

3. Assume that present cost behavior patterns continue into the latter half of the year. Estimate the total amount of manufacturing overhead the company can expect in November if 29,200 direct-labor hours are worked.

Manufacturing overhead cost

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

Tips For The New Auditor

Authors: Marty Sturino

1st Edition

1733097813, 978-1733097819

More Books

Students also viewed these Accounting questions