Mary Ellis owns a small manufacturing company and would like to develop more accurate estimates for overhead expenses whenmaking planning decisions. She is pretty sure that overhead is a mixed cost that varies with direct labour-hours but she would like todo a proper analysis to determine the variable and fixed components. She collected the following information for the past 12 monthson direct labour-hours incurred and total overhead expenses.Total OverheadCostsMonthDirectLabour-HoursJanuary1,500$ 44,000February1,680$47,200March1,800$ 48,000April2,520$51,200May2,700$ 53,600June3,300$ 56,800July3,900$ 59,200August4,500$ 61,600September4,200$60,000October2,700$ 54,400November1,860$ 49,600December3,900$ 58,400Required:1. Using the least-squares regression method, estimate the variable overhead cost per direct labour-hour and the total fixed overheadcost per month. (Round Fixed cost to the nearest whole dollar amount and the Variable cost per direct labour-hour to 2 decimalplaces.)Variable overhead costTotal fixed costper direct labour-hourper month

Name: Mary Ellis owns a small manufacturing company and would like to devel
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Description: Mary Ellis owns a small manufacturing company and would like to develop more accurate estimates for overhead expenses whenmaking planning decisions. She is pretty sure that overhead is a mixed cost that varies with direct labour-hours but she would

Regression analysis is a statistical method used to analyze the relationship between two or more…

Business

Accounting

Mary Ellis owns a small manufacturing company and would like to develop more accurate estimates for overhead expenses when making planning decisions. She is pretty sure that overhead is a mixed cost that varies with direct labour-hours but she would like to do a proper analysis to determine the variable and fixed components. She collected the following information for the past 12 months on direct labour-hours incurred and total overhead expenses. Direct Total Overhead Month January February March April May Labour-Hours 1,500 1,680 1,800 2,520 2,700 Costs $44,000 $47,200 $ 48,000 $51,200 $53,600 $56,800 ITT June July August September October November December 3,300 3,900 4,500 4,200 2,700 $59,200 $ 61,600 $60,000 1,860 3,900 $ 54,400 $ 49,600 $58,400 Required: 1. Using the least-squares regression method, estimate the variable overhead cost per direct labour-hour and the total fixed overhead cost per month. (Round Fixed cost to the nearest whole dollar amount and the Variable cost per direct labour-hour to 2 decimal places.)

Mary Ellis owns a small manufacturing company and would like to develop more accurate estimates for overhead expenses when making planning decisions. She is pretty sure that overhead is a mixed cost that varies with direct labour-hours but she would like to do a proper analysis to determine the variable and fixed components. She collected the following information for the past 12 months on direct labour-hours incurred and total overhead expenses. Direct Total Overhead Month January February March April May Labour-Hours 1,500 1,680 1,800 2,520 2,700 Costs $44,000 $47,200 $ 48,000 $51,200 $53,600 $56,800 ITT June July August September October November December 3,300 3,900 4,500 4,200 2,700 $59,200 $ 61,600 $60,000 1,860 3,900 $ 54,400 $ 49,600 $58,400 Required: 1. Using the least-squares regression method, estimate the variable overhead cost per direct labour-hour and the total fixed overhead cost per month. (Round Fixed cost to the nearest whole dollar amount and the Variable cost per direct labour-hour to 2 decimal places.)

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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