Bradford Company derived the following cost relationship from a regression analysis of its monthly manufacturing overhead cost: C = $80,000+ $12M Where: C = monthly manufacturing overhead cost, and M = machine hours The standard error of estimate of the regression is $6,000 The standard time required to manufacture one six-unit case of Bradford's single product is two machine hours Bradford applies manufacturing overhead to production on the basis of machine hours, and its normal annual production is 50,000 cases Bradford's estimated variable manufacturing overhead cost for a month in which scheduled production is 5,000 cases would be: A. $200,000 B. $140,000 C. $80,000 D. $120,000 E. Some amount other than those given above
Bradford Company derived the following cost relationship from a regression analysis of its monthly manufacturing overhead cost: C = $80,000+ $12M Where: C = monthly manufacturing overhead cost, and M = machine hours The standard error of estimate of the regression is $6,000 The standard time required to manufacture one six-unit case of Bradford's single product is two machine hours Bradford applies manufacturing overhead to production on the basis of machine hours, and its normal annual production is 50,000 cases Bradford's estimated variable manufacturing overhead cost for a month in which scheduled production is 5,000 cases would be: A. $200,000 B. $140,000 C. $80,000 D. $120,000 E. Some amount other than those given above
Chapter2: Building Blocks Of Managerial Accounting
Section: Chapter Questions
Problem 5EB: Baxter Company has a relevant range of production between 15,000 and 30,000 units. The following...
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