Question: Selected data about Pitkin Company's manufacturing operations at two levels of activity are given below: Number of units produced: 10,000 15,000 Total manufacturing costs: $157,000

Selected data about Pitkin Company's manufacturing operations at two levels of activity are given below:

Number of units produced: 10,000 15,000

Total manufacturing costs: $157,000 $225,000

Direct material cost per unit: $4 $4

Direct labour cost per unit: $6 $6

Using the high-low method, estimate the cost formula for manufacturing overhead. Assume that both direct material and direct labour are variable costs.

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