Blackhole Company's total overhead cost at various levels of activity are presented below: Month Total Overhead...
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Blackhole Company's total overhead cost at various levels of activity are presented below: Month Total Overhead Cost September $ 396,000.00 October $348,000.00 $444,000.00 $492,000.00 November December Machine Hours 140,000.00 120,000.00 160,000.00 180,000.00 Assume that the total overhead cost above consists of utilities, supervisory salaries, and maintenance. The breakdown of these costs at the 120,000 machine-hour level of activity is: Utilities (Variable) Supervisory Salaries (Fixed) Maintenance (Mixed) Total Overhead Cost $ 96,000.00 42,000.00 210,000.00 $ 348,000.00 Blackhole Company's management wants to break down the maintenance cost into variable and fixed cost elements. Required: 21. Estimate how much of the $492,000 of overhead cost in December was maintenance cost. 22. Using the high-low method, estimate a cost formula for maintenance in the form Y = a + bx 23. Express the company's total overhead cost in the form Y = a + bx Tran Company has for its first year of operations had the following production, cost and price data: Selling price $100; Materials per unit $2; Labor per unit $30; Variable Overhead per unit $10; Fixed Manufacturing Overhead $80,000; Fixed Selling and Administrative $40,000; Variable Selling Expenses $2 per unit; Sales in units of 9,500; and production units of 10,000 for its first year of operations. For its second year of operations, sales units total 11,000 and production was 10,500. There were no changes it its cost and price structure. Required: 24. Net operating income-variable costing method for the second year. 25. Net operating income-absorption costing method for the second year. Blackhole Company's total overhead cost at various levels of activity are presented below: Month Total Overhead Cost September $ 396,000.00 October $348,000.00 $444,000.00 $492,000.00 November December Machine Hours 140,000.00 120,000.00 160,000.00 180,000.00 Assume that the total overhead cost above consists of utilities, supervisory salaries, and maintenance. The breakdown of these costs at the 120,000 machine-hour level of activity is: Utilities (Variable) Supervisory Salaries (Fixed) Maintenance (Mixed) Total Overhead Cost $ 96,000.00 42,000.00 210,000.00 $ 348,000.00 Blackhole Company's management wants to break down the maintenance cost into variable and fixed cost elements. Required: 21. Estimate how much of the $492,000 of overhead cost in December was maintenance cost. 22. Using the high-low method, estimate a cost formula for maintenance in the form Y = a + bx 23. Express the company's total overhead cost in the form Y = a + bx Tran Company has for its first year of operations had the following production, cost and price data: Selling price $100; Materials per unit $2; Labor per unit $30; Variable Overhead per unit $10; Fixed Manufacturing Overhead $80,000; Fixed Selling and Administrative $40,000; Variable Selling Expenses $2 per unit; Sales in units of 9,500; and production units of 10,000 for its first year of operations. For its second year of operations, sales units total 11,000 and production was 10,500. There were no changes it its cost and price structure. Required: 24. Net operating income-variable costing method for the second year. 25. Net operating income-absorption costing method for the second year.
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Net operating income variable costing method for the second year 110... View the full answer
Related Book For
Managerial Accounting
ISBN: 9780073526706
12th Edition
Authors: Ray H. Garrison, Eric W. Noreen, Peter C. Brewer
Posted Date:
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