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

Principles of Accounting Volume 2
19th Edition
ISBN:9781947172609
Author:OpenStax
Publisher:OpenStax
Chapter6: Activity-based, Variable, And Absorption Costing
Section: Chapter Questions
Problem 1PB: Bobcat uses a traditional cost system and estimates next years overhead will be $800.000, as driven...
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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
Transcribed Image Text: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
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