Sunbeam Logistics would like you to estimate the maintenance costs on its delivery trucks. The cost is a mixed cost. The following data is obtained for the first 6 months of the year: Month Mileage (Miles) Costs ($) January 15,500 22,300 February 13,200 21,600 March 16,000 19,800 April 14,500 20,400 May 19,000 25,400 June 17,500 23,500 What is the fixed cost portion using the High-Low Method? A. $12,800 B. $14,500 C. $10,500 D. $15,000

Sunbeam Logistics would like you to estimate the maintenance costs on its delivery trucks. The cost is a mixed cost. The following data is obtained for the first 6 months of the year: Month Mileage (Miles) Costs ($) January 15,500 22,300 February 13,200 21,600 March 16,000 19,800 April 14,500 20,400 May 19,000 25,400 June 17,500 23,500 What is the fixed cost portion using the High-Low Method? A. $12,800 B. $14,500 C. $10,500 D. $15,000

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:...

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Markowis Corp. has collected the following data concerning its maintenance costs for the past 6 months.July August September October November DecemberUnits Produced18,000 32,000 36,000 22,000 40,000 38,000Total Cost$36,000 48,000 55,000 38,000 74,500 62,000Compute the variable- and fixed-cost elements using the high-low method.
ake's Roof Repair has provided the following data concerning its costs: Fixed Cost per Month Cost per Repair-Hour $ 21,300 $ 16.00 $ 7.00 $ 0.50 $ 1.50 Wages and salaries Parts and supplies Equipment depreciation $ 2,770 Truck operating expenses $5,780 $ 4,630 Administrative expenses $3,820 $ 0.80 For example, wages and salaries should be $21,300 plus $16.00 per repair-hour. The company expected to work 2,900 repair-hours in May, but actually worked 2,800 repair-hours. The company expects its sales to be $46.00 per repair-hour. Required: Compute the company's activity variances for May. Note: Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values. Rent
The controller of Sandhill Industries has collected the following monthly cost data for use in analyzing the behavior of maintenance costs. Month January February March April May June (a1) Total Maintenance Costs $2,880 3,273 3,928 4,632 3,491 4,844 X Your answer is incorrect. Total Machine Hours 3,820 Variable cost per machine hour $ 4,364 6,546 8,619 5,455 8,730 Determine the unit variable costs using the high-low method for this mixed cost. (Round answer to 2 decimal places e.g. 2.25.) 1352
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Calculating and Using a Single Charging Rate The expected costs for the Maintenance Department of Stazler, Inc., for the coming year include: Fixed costs (salaries, tools): $72,930 per year Variable costs (supplies): $1.30 per maintenance hour Estimated usage by: Assembly Department 4,900 Fabricating Department 6,200 Packaging Department 11.000 Total maintenance hours 22,100 Actual usage by: Assembly Department 3,425 Fabricating Department 6,300 Packaging Department 10,200 Total maintenance hours 19,925 Required: 1. Calculate a single charging rate for the Maintenance Department. Round your answer to the nearest cent. per maintenance hour 2. Use this rate to assign the costs of the Maintenance Department to the user departments based on actual usage. Calculate the total amount charged for maintenance for the year. 3. What if the Assembly Department used 4,000 maintenance hours in the year? How much would have been charged out to the three departments? when required, round your answers…
The controller of Sandhill Industries has collected the following monthly expense data for use in analyzing the cost behavior of maintenance costs. Month January February March April May June Variable cost per machine hour Total Maintenance Costs Determine the variable-cost components using the high-low method. (Round answer to 2 decimal places e.g. 2.25.) Determine the fixed cost components using the high-low method. Fixed costs $2,825 3,210 3,852 4,815 3,424 5,476 Total Machine Hours 3,740 4,280 6,420 8,453 5,350 8,560 $ $
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Buckeye Company has provided the following data for maintenance costs: Prior Year Current Year Machine hours 19,100 22,200 Maintenance cost $30,500 $34,220 Required: The best estimate of the cost formula for maintenance would be: (Do not round intermediate calculations. Round your Variable cost per unit to 2 decimal places.) a) $7,580 per year plus $.833 per machine hour. b) $26,640 per year plus $.833 per machine hour. c) $7,580 per year plus $1.20 per machine hour. d) $30,500 per year plus $1.20 per machine hour.