Nas corporation's manager in the stamping department have been studying the overhead costand the relationship machine hours. Data from the most recent 12 monthsMonthOverheadMachine hoursJanuaryFebruary5,0302,7301,600600March7,2103,403April4,5602,200May6,8803,411June6,5202,586July6,2303,364August5,5702,411September7,7283,960October5,8102,897November4,5802,207December6,0102,864The manager of the department has requested a regression analysis ofthese two variables. The staff person performing the analysis decided toexclude February. She observed the volume of activity was very low forthat month because of two factors: A severe flue outbreak and anelectrical fire that disrupted operations for about 10 working days. Using the least square (regression) analysis, compute the fixed cost.Using the least square (regression) analysis, how much is the estimated overhead costs for 3,000 machine hours?

Variable cost is the cost which changes with the change in the unit of output.

Answered: Using the least square (regression)…

FINANCIAL ACCOUNTING

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Chapter1: Financial Statements And Business Decisions

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From the below given data, which cost has no relationship with the level of output? Type of cost Amounts (OMR) Total cost 6,000 Variable costs 4,000 Semi variable costs 1,000 Fixed cost 1,000 O a. Variable costs O b. Semi variable costs OC. Total cost Od. Fixed cost
You have calculated, using the high-low method, a variable cost per machine hour of $0.80 for your production power costs. Power costs at 6,000 machine hours are $5,400; at 9,000 machine hours, they are $7,800. What are the total fixed costs that you would use to estimate production power costs for your company at any level within your relevant range? a. $600 b. $6,400 c. $2,400 d. $4,800
Calculate the per-unit contribution margin of a product that has a sale price of $225 if the variable costs per unit are $70. Contribution margin $ per unit
An analysis of a particular mixed cost indicates it will be an average of $0.65 per hour at an activity level of 18,000 hours and $11,700 in total at an activity level of 20,000 hours. Assuming that this activity is within the relevant range, what is the cost expected to total at an activity level of 16,000 hours
Given the following data: Contribution margin per unit: Product A $11Product B $12 Machine hours required for one unit: Product A 2 hoursProduct B 2.5 hours A. Compute the contribution margin per unit of limited resource for each product.
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Required: 1. Using the five most expensive activities, calculate the overhead cost assigned to each prod-uct. Assume that the costs of the other activities are assigned in proportion to the cost of the five activities.2. Calculate the error relative to the fully specified ABC product cost and comment on the outcome.3. What if activities 1, 2, 5, and 8 each had a cost of $650,000 and the remaining activities hada cost of $50,000? Calculate the cost assigned to Wafer A by a fully specified ABC systemand then by an approximately relevant ABC approach. Comment on the implications forthe approximately relevant approach.
Pharoah Company has a unit selling price of $576, variable costs per unit of $324, and fixed costs of $183,456. Compute the break-even point in units using (a) the mathematical equation and (b) unit contribution margin. Break-even point (a) Mathematical Equation (b) Unit contribution margin units units
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The McGraw Company is accumulating data to be used in preparing its annual profit plan for the coming year. The cost behavior pattern of the maintenance costs must be determined. The accounting staff has suggested that linear regression be employed to derive an equation in the form of y = a + bx for maintenance costs. Data regarding the maintenance hours and costs for last year and the results of the regression analysis are as follows: (CMA adapted) Hours of January February March April May June July August September October November December Sum Average A coefficient B coefficient Standard error of the a coefficient Standard error of the b coefficient Standard error of the estimate R² T-value a T-value b Activity 480 320 400 300 500 310 320 520 490 470 350 340 4,800 400 49.515 0.12126 Maintenance Costs 4,200 3,000 3,600 2,820 4,350 2,960 3,030 4,470 4,260 4,050 3,300 3,160 $ $ 43,200 3,600 684.65 7.2884 34.469 0.99724 13.827 60.105 What is the variable cost per hour using the high-low…

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Using the least square (regression) analysis, compute the fixed cost. Using the least square (regression) analysis, how much is the estimated overhead costs for 3,000 machine hours?