Which of the following statements about contribution format income statement is correct? Multiple Choice It is a part of the external reporting. It focused on mixed costs. It separates costs into fixed and variable first deducting fixed expenses from sale to obtain contribution margin. It is a part of the external reporting. It focused on mixed costs. It separates costs into fixed and variable first deducting fixed expenses from sale to obtain contribution margin. It clearly distinguishes between fixed and variable. Required information [The following information applies to the questions displayed below.] Phillips Company manufactures air-conditioning units for commercial buildings and has noticed considerable variation in shipping expenses from month to month as per the data below: 4. What is the cost formula for shipping expenses? variation in shipping expenses trom month to month as per the data below: 4. What is the cost formula for shipping expenses? Required information [The following information applies to the questions displayed below.] Phillips Company manufactures air-conditioning units for commercial buildings and has noticed considerable variation in shipping expenses from month to month as per the data below: 5. If seven air conditioners are shipped in August, estimate the total shipping expenses. Crosshill Company's total overhead costs at various levels of activity are presented below: Assume that the overhead cost above consists of utilities, supervisory salaries, and maintenance. The breakdown of these costs at the 60,000 machine-hour level of activity in May is as follows: The company wants to break down the maintenance cost into its variable and fixed cost elements. Assume that the overhead cost above consists of utilities, supervisory salaries, and maintenance. The breakdown of these costs at the 60,000-machine-hour level of activity in May is as follows: The company wants to break down the maintenance cost into its variable and fixed cost elements. Required: 1. Estimate how much of the $246,000 of overhead cost in July was maintenance cost. (Hint: To do this, first determine how much of the $246,000 consisted of utilities and supervisory salaries. Think about the behaviour of variable and fixed costs within the relevant range.) (Round the "Variable cost per unit" to 2 decimal places.) Using the high-low method, estimate a cost formula for maintenance. (Round the "Variable cost per unit" to 2 decimal places.) 3. Express the company's total overhead cost in the form Y=a+bX. (Round the "Variable cost per unit" to 2 decimal places.) 4. What total overhead cost would you expect to be incurred at an activity level of 75,000 machine-hours? (Round the "Variable cost per unit" to 2 decimal places.)
