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Winslow Inc., a manufacturing firm, manufactures tires. The company has supplied information from its accounting records for the last year. No. of Factory Month Tires
Winslow Inc., a manufacturing firm, manufactures tires. The company has supplied information from its accounting records for the last year. No. of Factory Month Tires Overhead Jan 500,000 $900,000 Feb 600,000 $1,080,000 Mar 675,000 $1,250,000 Apr 575,000 $950,000 May 475,000 $900,000 Jun 525,000 $935,000 Jul 450,000 $790,000 Aug 550,000 $1,075,000 Sep 425,000 $830,700 Oct 562,500 $1,015,000 Nov 650,000 $1,295,000 Dec 537,500 $915,000 Part 1: Using the high low method, what is the variable factory overhead per tire? Using the rounded answer which you just input (above), what is the fixed cost for factory overhead? Part 2: If the company increases their production of tires by 30% in any given month, would the factory overhead cost per tire increase, decrease, or stay the same? Enter the number 1 if it would increase. Enter the number 2 if it would decrease. Enter the number 3 if it would stay the same. Part 3: ASSUME the total cost of factory overhead equals $114,500 + (1.75 * number of tires manufactured). What would total cost equal if the company manufacturers 543,800 tires? Part 4: If the total cost of factory overhead equals $1,066,000 and the company manufacturers 543,800 tires, what is the total factory overhead cost per tire manufactured
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