Changing the Cost Formula for a Month to the Cost Formula for a Year During the past year, the high and low use of three different resources for Fly High Airlines occurred in July and April. The resources are airplane depreciation, fuel, and airplane maintenance. The number of airplane flight hours is the driver. The total costs of the three resources and the related number of airplane flight hours are as follows: Resource Airplane Flight Hours Total Cost Airplane depreciation: High Low 44,000 $ 18,300,000 28,000 $18,300,000 Fuel: High 44,000 445,896,000 Low 28,000 283,752,000 < Airplane maintenance: High 44,000 15,888,000 Low 28,000 12,384,000 Required: If required, round calculations and answers to nearest dollar. EXCEPT round variable rate per hour to the nearest cent. 1. Develop an annual cost formula for airplane depreciation. Total annual cost of airplane depreciation - Develop an annual cost formula for fuel. Total annual cost of fuel = $ 12 x ($18,300,000) 10,134 × Annual number of airplane flight hours Develop an annual cost formula for airplane maintenance. Total annual cost of airplane maintenance ( 12,384,000 x 9 15,888,000 + ($ x 2. Using the three annual cost formulas that you developed, predict the cost of each resource in a year with 480,000 airplane flight hours. Total annual cost of airplane depreciation Total annual cost of fuel Total annual cost of airplane maintenance Check My Work ) Previous Next
Changing the Cost Formula for a Month to the Cost Formula for a Year During the past year, the high and low use of three different resources for Fly High Airlines occurred in July and April. The resources are airplane depreciation, fuel, and airplane maintenance. The number of airplane flight hours is the driver. The total costs of the three resources and the related number of airplane flight hours are as follows: Resource Airplane Flight Hours Total Cost Airplane depreciation: High Low 44,000 $ 18,300,000 28,000 $18,300,000 Fuel: High 44,000 445,896,000 Low 28,000 283,752,000 < Airplane maintenance: High 44,000 15,888,000 Low 28,000 12,384,000 Required: If required, round calculations and answers to nearest dollar. EXCEPT round variable rate per hour to the nearest cent. 1. Develop an annual cost formula for airplane depreciation. Total annual cost of airplane depreciation - Develop an annual cost formula for fuel. Total annual cost of fuel = $ 12 x ($18,300,000) 10,134 × Annual number of airplane flight hours Develop an annual cost formula for airplane maintenance. Total annual cost of airplane maintenance ( 12,384,000 x 9 15,888,000 + ($ x 2. Using the three annual cost formulas that you developed, predict the cost of each resource in a year with 480,000 airplane flight hours. Total annual cost of airplane depreciation Total annual cost of fuel Total annual cost of airplane maintenance Check My Work ) Previous Next
Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Don R. Hansen, Maryanne M. Mowen
Chapter7: Allocating Costs Of Support Departments And Joint Products
Section: Chapter Questions
Problem 1CE: The expected costs for the Maintenance Department of Stazler, Inc., for the coming year include:...
Related questions
Question
Transcribed Image Text:Changing the Cost Formula for a Month to the Cost Formula for a Year
During the past year, the high and low use of three different resources for Fly High Airlines occurred in July and April. The resources are airplane depreciation, fuel, and airplane maintenance. The number of airplane flight hours is the driver. The
total costs of the three resources and the related number of airplane flight hours are as follows:
Resource
Airplane Flight Hours Total Cost
Airplane depreciation:
High
Low
44,000
$ 18,300,000
28,000
$18,300,000
Fuel:
High
44,000
445,896,000
Low
28,000
283,752,000
<
Airplane maintenance:
High
44,000
15,888,000
Low
28,000
12,384,000
Required:
If required, round calculations and answers to nearest dollar. EXCEPT round variable rate per hour to the nearest cent.
1. Develop an annual cost formula for airplane depreciation.
Total annual cost of airplane depreciation -
Develop an annual cost formula for fuel.
Total annual cost of fuel = $
12 x ($18,300,000)
10,134 × Annual number of airplane flight hours
Develop an annual cost formula for airplane maintenance.
Total annual cost of airplane maintenance (
12,384,000 x 9
15,888,000 + ($
x
2. Using the three annual cost formulas that you developed, predict the cost of each resource in a year with 480,000 airplane flight hours.
Total annual cost of airplane depreciation
Total annual cost of fuel
Total annual cost of airplane maintenance
Check My Work
)
Previous
Next
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 2 steps with 1 images
Recommended textbooks for you
Cornerstones of Cost Management (Cornerstones Ser…
Accounting
ISBN:
9781305970663
Author:
Don R. Hansen, Maryanne M. Mowen
Publisher:
Cengage Learning
Managerial Accounting
Accounting
ISBN:
9781337912020
Author:
Carl Warren, Ph.d. Cma William B. Tayler
Publisher:
South-Western College Pub
Managerial Accounting: The Cornerstone of Busines…
Accounting
ISBN:
9781337115773
Author:
Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher:
Cengage Learning
Cornerstones of Cost Management (Cornerstones Ser…
Accounting
ISBN:
9781305970663
Author:
Don R. Hansen, Maryanne M. Mowen
Publisher:
Cengage Learning
Managerial Accounting
Accounting
ISBN:
9781337912020
Author:
Carl Warren, Ph.d. Cma William B. Tayler
Publisher:
South-Western College Pub
Managerial Accounting: The Cornerstone of Busines…
Accounting
ISBN:
9781337115773
Author:
Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher:
Cengage Learning
Survey of Accounting (Accounting I)
Accounting
ISBN:
9781305961883
Author:
Carl Warren
Publisher:
Cengage Learning
Financial And Managerial Accounting
Accounting
ISBN:
9781337902663
Author:
WARREN, Carl S.
Publisher:
Cengage Learning,