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 1,700 machine-hours next year. What are the estimated monthly overhead costs, assuming no inflation? Adriana Corporation manufactures football equipment. In planning for next year, the managers want to understand the relationbetween 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-lours Machine-Hours Overhead Costs1,3491,4071,5251,4491,5891,5821,3901,3131,4551,5381,2901,616$ 102,631103,799109,901108,399116,101114,469106,963102,142106,396113,03599,045111,9221.7257206854.7357857557307259.715101180066512715Required: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 1,700 machine-hours next year. What are the estimated monthlyoverhead costs, assuming no infiation?Complete this question by entering your answers in the tabs below.Required ARequired BUse 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

Name: A. Use the high-low method to estimate the fixed and variable portions
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Description: 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 1,700 machine-hours next year. What are the estimated monthly overhead cos

Working Notes: 1. Variable cost = Variable cost per machine hour * No. of Machine Hours = $39.5 *…

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Adriana Corporation manufactures football equlpment. In planning for next year, the managers want to understand the relation between activity and overhead costs. Discusslons 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. Honth Labor-Hours Machine-llours 1,349 1,407 1,525 1,449 1,589 1,582 1,390 1,313 1,455 1,538 1,290 1,616 Overhead Costs $102,631 103,799 109,901 108,399 116,101 114,469 106,963 102,142 106,396 113,035 99,045 111,922 725 720 685 4. 735 785 6. 755 730 725 715 B00 665 6. 10 11 12 715 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 1,700 machine-hours next year. What are the estimated monthly overhead costs, assuming no inflation?

Adriana Corporation manufactures football equlpment. In planning for next year, the managers want to understand the relation between activity and overhead costs. Discusslons 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. Honth Labor-Hours Machine-llours 1,349 1,407 1,525 1,449 1,589 1,582 1,390 1,313 1,455 1,538 1,290 1,616 Overhead Costs $102,631 103,799 109,901 108,399 116,101 114,469 106,963 102,142 106,396 113,035 99,045 111,922 725 720 685 4. 735 785 6. 755 730 725 715 B00 665 6. 10 11 12 715 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 1,700 machine-hours next year. What are the estimated monthly overhead costs, assuming no inflation?

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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Question

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 1,700 machine-hours next year. What are the estimated monthly overhead costs, assuming no inflation?

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-lours Machine-Hours Overhead Costs
1,349
1,407
1,525
1,449
1,589
1,582
1,390
1,313
1,455
1,538
1,290
1,616
$ 102,631
103,799
109,901
108,399
116,101
114,469
106,963
102,142
106,396
113,035
99,045
111,922
1.
725
720
685
4.
735
785
755
730
725
9.
715
10
11
800
665
12
715
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 1,700 machine-hours next year. What are the estimated monthly
overhead costs, assuming no infiation?
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

Definition Definition Indirect costs incurred while producing goods or services. Overhead costs cannot be directly attributed to products or services. Overhead includes indirect material cost, indirect labor cost, rent, utilities expenses, and depreciation. Since these costs directly affect the profitability of a company, managing overhead becomes an important task for management.

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A.Prepare Statement of Income and Expenses with a marginal contribution approach. Empresas La Torre presents the following information for the year ended December 31, 2020: Product Costs: Direct materials (Variables) $ 50.00 per unit Direct Labor (Variable) $ 20.00 per hour Variable Indirect Costs $ 10.00 per hour Total Fixed Indirect Costs $ 250,000 Period Expenses Seller Commissions $ 20.00 per unit Variable Administrative Expenses $ 30.00 per unit Total Fixed Administrative Expenses $ 150,000 The company sells solar batteries at $ 200.00 per unit. Making each battery takes 2 hours of direct labor. The company taxes its income at 40%. If the Company sells 10,000 units, prepare a statement of income and expenses using the marginal contribution approach.
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[The following information applies to the questions displayed below.] Alden Company's monthly data for the past year follow. Management wants to use these data to predict future variable and fixed costs. Month Units Sold Total Cost Month Units Sold Total Cost 1 324,500 $ 162,000 7 355,500 $ 245,564 2 169,500 105,750 8 274,500 156,250 3 269,500 210,100 9 75,100 60,500 4 209,500 104,500 10 154,500 135,125 5 294,500 206,000 11 6 194,500 116,500 12 98,500 104,500 98,500 77,150 Problem 18-1A (Algo) Part 1 1. Estimate both the variable costs per unit and the total monthly fixed costs using the high-low method. (Do not round intermediate calculations.) High-Low method - Calculation of variable cost per unit Total cost at the high point Variable costs at the high point: Volume at the high point: Variable cost per unit Total variable costs at the high point Total fixed costs High-Low method - Calculation of fixed costs Total cost at the low point Variable costs at the low point: Volume at the…
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A manager must decide between two machines. The manager will take into account each machine's operating costs and initial costs, and its breakdown and repair times. Machine A has a projected average operating time of 131 hours and a projected average repair time of 4 hours. Projected times for machine B are an average operating time of 61 hours and a repair time of 5 hours. What are the projected availabilities of each machine? (Round your answers to 3 decimal places.) Answer is complete but not entirely correct. Availability 0.952 0.945 Machine A Machine B