Question: Tasty Catering uses the high-low method to predict its total overhead costs. Past records show that total overhead cost was $25,600 when 820 hours were

Tasty

Catering uses the high-low method to predict its total overhead costs. Past records show that total overhead cost was

$25,600

when

820

hours were worked and

$27,200

when

920

hours were worked. If

Tasty

Catering has

845

hours scheduled for next month, what is the expected total overhead cost for next month?

Use the high-low method to determine the variable and fixed costs components of

Tasty

Catering's operating cost equation.

First identify the formula and calculate the variable cost component (slope). (Enter the variable cost per unit to the nearest cent.)

Change in costs

Change in volume

Variable cost per unit

Next identify the formula and compute the fixed cost component (the vertical intercept) using the costs for the highest level of activity.

Total mixed (overhead) cost

Total variable cost

Total fixed costs

Complete

Tasty

Caterings's operating cost equation.

y =

x +

Tasty

Catering has

845

hours scheduled next month, what is the expected total overhead cost?

The total monthly operating costs if Tasty Catering works 845 labor hours is

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