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Adriana Corporation manufactures football equipment. In planning for next year, the managers want to understand the between activity and overhead costs. Discussions with the plant supervisor suggest that overhead seems to vary with labor-hours, machine-hours, or both. The following data were collected from last year's operations. Month Labor-Hours Machine-Hours Overhead Costa 1 735 2 10 11 725 670 730 795 750 730 735 710 785 675 705 1,351 1,410 1,515 1,456 1,587 1,502 1,380 1,312 1,451 1,545 1,204 1,618 $102,759 103,790 109,938 108,327 116,155 114,400 107,079 102,103 106,331 113,000 98,444 111,303

Adriana Corporation manufactures football equipment. In planning for next year, the managers want to understand the between activity and overhead costs. Discussions with the plant supervisor suggest that overhead seems to vary with labor-hours, machine-hours, or both. The following data were collected from last year's operations. Month Labor-Hours Machine-Hours Overhead Costa 1 735 2 10 11 725 670 730 795 750 730 735 710 785 675 705 1,351 1,410 1,515 1,456 1,587 1,502 1,380 1,312 1,451 1,545 1,204 1,618 $102,759 103,790 109,938 108,327 116,155 114,400 107,079 102,103 106,331 113,000 98,444 111,303

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Required: a. Use the high-low method to estimate the fixed and variable portions of overhead costs based on machine-hours. b. Managers expect the plant to operate at a monthly average of 1,500 machine-hours next year. What are the estimated monthly overhead costs, assuming no inflation? Complete this question by entering your answers in the tabs below. Required A Required B Use the high-low method to estimate the fixed and variable portions of overhead costs based on machine-hours. (Round "Variable cost" answer to 2 decimal places.) Variable cost (per machine hour) Fixed cost Required A Required: a. Use the high-low method to estimate the fixed and variable portions of overhead costs based on machine-hours. b. Managers expect the plant to operate at a monthly average of 1,500 machine-hours next year. What are the estimated monthly overhead costs, assuming no inflation? Required B > Complete this question by entering your answers in the tabs below. Overhead costs Required A Required B Managers expect the plant to operate at a monthly average of 1,500 machine-hours next year. What are the estimated monthly overhead costs, assuming no inflation? < Required A Required B >
Transcribed Image Text:Required: a. Use the high-low method to estimate the fixed and variable portions of overhead costs based on machine-hours. b. Managers expect the plant to operate at a monthly average of 1,500 machine-hours next year. What are the estimated monthly overhead costs, assuming no inflation? Complete this question by entering your answers in the tabs below. Required A Required B Use the high-low method to estimate the fixed and variable portions of overhead costs based on machine-hours. (Round "Variable cost" answer to 2 decimal places.) Variable cost (per machine hour) Fixed cost Required A Required: a. Use the high-low method to estimate the fixed and variable portions of overhead costs based on machine-hours. b. Managers expect the plant to operate at a monthly average of 1,500 machine-hours next year. What are the estimated monthly overhead costs, assuming no inflation? Required B > Complete this question by entering your answers in the tabs below. Overhead costs Required A Required B Managers expect the plant to operate at a monthly average of 1,500 machine-hours next year. What are the estimated monthly overhead costs, assuming no inflation? < Required A Required B >
Adriana Corporation manufactures football equipment. In planning for next year, the managers want to understand the relation between activity and overhead costs. Discussions with the plant supervisor suggest that overhead seems to vary with labor-hours, machine-hours, or both. The following data were collected from last year's operations. Month Labor-Hours 1 2 3 4 6 7 9 10 11 12 735 725 670 730 785 750 730 735 710 785 675 705 Machine-Hours 1,351 1,418 1,515 1,456 1,587 1,582 1,380 1,312 1,451 1,545 1,204 1,610 Overhead Costs $ 102,759 103,790 109,938 108,327 116,155 114,400 107,079 102,103 106,331 113,000 98,444 111,303) Required: a. Use the high-low method to estimate the fixed and variable portions of overhead costs based on machine-hours. b. Managers expect the plant to operate at a monthly average of 1,500 machine-hours next year. What are the estimated monthly overhead costs, assuming no inflation?
Transcribed Image Text:Adriana Corporation manufactures football equipment. In planning for next year, the managers want to understand the relation between activity and overhead costs. Discussions with the plant supervisor suggest that overhead seems to vary with labor-hours, machine-hours, or both. The following data were collected from last year's operations. Month Labor-Hours 1 2 3 4 6 7 9 10 11 12 735 725 670 730 785 750 730 735 710 785 675 705 Machine-Hours 1,351 1,418 1,515 1,456 1,587 1,582 1,380 1,312 1,451 1,545 1,204 1,610 Overhead Costs $ 102,759 103,790 109,938 108,327 116,155 114,400 107,079 102,103 106,331 113,000 98,444 111,303) Required: a. Use the high-low method to estimate the fixed and variable portions of overhead costs based on machine-hours. b. Managers expect the plant to operate at a monthly average of 1,500 machine-hours next year. What are the estimated monthly overhead costs, assuming no inflation?
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