Cost Accounting42Problem 10estimateoverhead costs to plan its operations. A recent trade publication revealed thatoverhead costs tend to vary with machine hours. To check this, they collected thefollowing data for the past 12 months.ValdezMotors Co. makes motorcycles. Management wants toOverhead CostsP 4,5004,2254,3215,2504,8005,1004,4504,2005,4754,7604,3253,975Machine Hours175Month No.170316041901756.20071608.1509.210101801701112145Requirements1. Use the high-low method to estimate the fixed and variable portion ofoverhead costs based on machine hours.2. If the plant is planning to operate at a level of 200 machine hours nextperiod, what would be the estimated overhead costs?3. Use the method of least square to estimate the fixed and variable portion ofoverhead costs based on machine hours.

The question is based on the concept of Cost Accounting.

Problem 10 estimate Valdez Motors Co. makes motorcycles. Management wants to overhead costs to plan its operations. A recent trade publication revealed that overhead costs tend to vary with machine hours. To check this, they collected the following data for the past 12 months. Overhead Costs P 4,500 4,225 4,321 5,250 Machine Hours 175 Month No. 170 160 190 1.000 34

Problem 10 estimate Valdez Motors Co. makes motorcycles. Management wants to overhead costs to plan its operations. A recent trade publication revealed that overhead costs tend to vary with machine hours. To check this, they collected the following data for the past 12 months. Overhead Costs P 4,500 4,225 4,321 5,250 Machine Hours 175 Month No. 170 160 190 1.000 34

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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