Mississippi Corporation is preparing a budget for manufactur ing overhead the upcoming year. It estimates that...
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Mississippi Corporation is preparing a budget for manufactur ing overhead the upcoming year. It estimates that it will produce 75,000 units of output with the following estimated breakdown of manufacturing overhead costs. MISSISSIPPI CORPORATION ESTIMATED MANUFACTURING OVERHEAD COSTS FOR UPCOMING YEAR Manufacturing Overhead Item Estimated Costs Indirect Materials (all variable) 34,500 Indirect Labor (90% fixed) 185,600 Building Occupancy Costs (all fixed) 219,400 Power (all variable) 24,500 Equipment Depreciation (all fixed) Equipment Maintenance (30% fixed) 165,000 21,600 Personal Property Taxes (40% fixed) 12,800 Data Processing (80% fixed) Technical Support (all fixed) 9,800 14,600 Total Estimated Manufacturing Overhead 687,800 The company's accountants have assumed that total manufacturing overhead cost is related to poduction levels. To test this relationship, the accountants gathered manufacturing cost data and the related production data for past accounting periods. This data is provided below. MISSISSIPPI CORPORATION MANUFACTURING COST DATA FOR PREVIOUS ACCOUNTING PERIODS Total Productien (Units) Total Manufacturing Overhead Cost 718,480 62,800 735,110 72,800 768,310 93,400 717,670 56,900 715,960 58,800 726,880 69,000 753,420 87,000 777,640 98,000 720,410 59,200 718,100 62,600 736,800 73,100 714,220 60.400 After running the above sets of data in a singde regression program, the following results were obtained. MISSISSIPPI CORPORATION REGRESSION ANALYSIS RESULTS FOR MANUFACTURING COST DATA FOR PREVIOUS ACCOUNTING PERIODS Intercept 626,547 b Coefficient Cornelation Coefmicient R Squared 1.504 0.988 0,976 Prepare a cost estimation equation for manufacturing overhead using the high-low method. Round the variable cost per unit to three decimal places and the fixed cost to the nearest whole dollar. (1) Prepare a cost estimation equation using the information for single linear regression. Determine the total estimated manufacturing overhead costs for the current year using the following methods. Round your answer to the nearest whole dollar. (2) (3) (a) High-low method. Mississippi Corporation is preparing a budget for manufactur ing overhead the upcoming year. It estimates that it will produce 75,000 units of output with the following estimated breakdown of manufacturing overhead costs. MISSISSIPPI CORPORATION ESTIMATED MANUFACTURING OVERHEAD COSTS FOR UPCOMING YEAR Manufacturing Overhead Item Estimated Costs Indirect Materials (all variable) 34,500 Indirect Labor (90% fixed) 185,600 Building Occupancy Costs (all fixed) 219,400 Power (all variable) 24,500 Equipment Depreciation (all fixed) Equipment Maintenance (30% fixed) 165,000 21,600 Personal Property Taxes (40% fixed) 12,800 Data Processing (80% fixed) Technical Support (all fixed) 9,800 14,600 Total Estimated Manufacturing Overhead 687,800 The company's accountants have assumed that total manufacturing overhead cost is related to poduction levels. To test this relationship, the accountants gathered manufacturing cost data and the related production data for past accounting periods. This data is provided below. MISSISSIPPI CORPORATION MANUFACTURING COST DATA FOR PREVIOUS ACCOUNTING PERIODS Total Productien (Units) Total Manufacturing Overhead Cost 718,480 62,800 735,110 72,800 768,310 93,400 717,670 56,900 715,960 58,800 726,880 69,000 753,420 87,000 777,640 98,000 720,410 59,200 718,100 62,600 736,800 73,100 714,220 60.400 After running the above sets of data in a singde regression program, the following results were obtained. MISSISSIPPI CORPORATION REGRESSION ANALYSIS RESULTS FOR MANUFACTURING COST DATA FOR PREVIOUS ACCOUNTING PERIODS Intercept 626,547 b Coefficient Cornelation Coefmicient R Squared 1.504 0.988 0,976 Prepare a cost estimation equation for manufacturing overhead using the high-low method. Round the variable cost per unit to three decimal places and the fixed cost to the nearest whole dollar. (1) Prepare a cost estimation equation using the information for single linear regression. Determine the total estimated manufacturing overhead costs for the current year using the following methods. Round your answer to the nearest whole dollar. (2) (3) (a) High-low method.
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