Question

The following information is available regarding the total manufacturing overhead of Bursa Mfg. Co. for a...

The following information is available regarding the total manufacturing overhead of Bursa Mfg. Co. for a recent four-month period.

Machine-
Hours		 Manufacturing Overhead
January 5,300 $ 310,000
February 3,200 224,000
March 4,900 263,800
April 2,800 190,000


a-1. Use the high-low method to determine the variable element of manufacturing overhead costs per machine-hour. (Round your answer to 2 decimal places.)

a-2. Use the high-low method to determine the fixed element of monthly overhead cost.

b. Bursa expects machine-hours in May to equal 5,300. Use the cost relationships determined in part a to forecast May's manufacturing overhead costs.

c. Suppose Bursa had used the cost relationships determined in part a to estimate the total manufacturing overhead expected for the months of February and March. By what amounts would Bursa have over- or underestimated these costs?

Business   Accounting   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
The following information is available regarding the total manufacturing overhead of Bursa Mfg. Co. for a...
The following information is available regarding the total manufacturing overhead of Bursa Mfg. Co. for a recent four-month period. Machine- Hours Manufacturing Overhead January 5,300 $ 310,000 February 3,200 224,000 March 4,900 263,800 April 2,700 190,000 a-1. Use the high-low method to determine the variable element of manufacturing overhead costs per machine-hour. (Round your answer to 2 decimal places.) a-2. Use the high-low method to determine the fixed element of monthly overhead cost. b. Bursa expects machine-hours in May to...
The following information is available regarding the total repair costs of Billy´s Automotive Company for six...
The following information is available regarding the total repair costs of Billy´s Automotive Company for six months of 2016: # of Units produced Total Cost January 1,600 $ 15,700 February 1,850 $ 17,300 March 1,100 $ 12,550 April 1,350 $ 14,100 May 1,975 $ 18,000 June 2,350 $ 21,050 Instruction: (show your calculations and round to 2 decimal places) Compute the following using the high low method: The variable element of repair cost per unit of production: The fixed element...
Question # 7 Dubai Heavy Industries (DHI) is manufacturing company whose total manufacturing overhead costs fluctuate...
Question # 7 Dubai Heavy Industries (DHI) is manufacturing company whose total manufacturing overhead costs fluctuate somewhat from year to year according to the number of machine-hours worked in its production facility. These costs at high and low levels of activity over recent years are given below: Level of Activity Low High Machine-hours 60,000 80,000 Total Manufacturing Overhead Costs $274,000 $312,000 The manufacturing overhead costs above consist of Indirect Materials, Rent, and Maintenance. The company has analyzed these costs at...
Sawaya Co., Ltd., of Japan is a manufacturing company whose total factory overhead costs fluctuate considerably...
Sawaya Co., Ltd., of Japan is a manufacturing company whose total factory overhead costs fluctuate considerably from year to year according to increases and decreases in the number of direct labor-hours worked in the factory. Total factory overhead costs at high and low levels of activity for recent years are given below: Level of Activity Low High Direct labor-hours 52,800 70,400 Total factory overhead costs $ 286,620 $ 328,860 The factory overhead costs above consist of indirect materials, rent, and...
Salter Manufacturing Company produces inventory in a highly automated assembly plant in Fall River, Massachusetts. The...
Salter Manufacturing Company produces inventory in a highly automated assembly plant in Fall River, Massachusetts. The automated system is in its first year of operation and management is still unsure of the best way to estimate the overhead costs of operations for budgetary purposes. For the first six months of operations, the following data were collected: Machine-hours Kilowatt-hours Total Overhead Costs January 4,560 5,424,000 $405,600 February 4,380 5,208,000 404,160 March 4,680 5,400,000 407,040 April 3,960 5,148,000 404,160 May 3,900 5,040,000...
The following are monthly high and low levels of Direct labor hours and total manufacturing overhead...
The following are monthly high and low levels of Direct labor hours and total manufacturing overhead for Sam Manufacturing: Direct                          Total Labor                   Manufacturing Hours                     Overhead                               Highest observed level           6,000                     $17,000                         Lowest observed level                        4,000                       14,000               In a month in which 5,000 direct labor hours are used, the fixed element of total               Manufacturing overhead costs should be approximately: $15,000. $8,000. $7,500. $8,000 plus $1.50 per unit.
Moresan Co. gathered the following information on power costs and factory machine usage for the last...
Moresan Co. gathered the following information on power costs and factory machine usage for the last six months: Month Power Costs $ Factory Machine Hours January 18,000 10,000 February 16,650 9,000 March 18,600 10,600 April 16,200 8,800 May    17,100 9,500 June        16,900 9,350 Using the high-low method of analyzing costs, ans Using the high-low method of analyzing costs, answer the following questions, and show computations to support your answers. (1) Compute      a) the variable cost (5 points)      b)...
Echeverria SA is an Argentinian manufacturing company whose total factory overhead costs fluctuate somewhat from year...
Echeverria SA is an Argentinian manufacturing company whose total factory overhead costs fluctuate somewhat from year to year according to the number of machine-hours worked in its production facility. These costs (in Argentinian pesos) at high and low levels of activity over recent years are given below: Level of Activity Level of Activity Low High Machine-hours 60,000 80,000 Total factory overhead costs 274,000 pesos 312,000 pesos The factory overhead costs above consist of indirect materials, rent, and maintenance. The company...
The following selected data were taken from the accounting records of Manitoba Manufacturing Company. The company...
The following selected data were taken from the accounting records of Manitoba Manufacturing Company. The company uses direct-labor hours as its cost driver for overhead costs.   Month Direct-Labor Hours Manufacturing Overhead   January 24,000       $ 750,250   February 23,000       724,000   March 26,000       778,500   April 21,000       685,000   May 28,000       781,500   June 30,000       883,000 June’s costs consisted of machine supplies ($123,000), depreciation ($24,500), and plant maintenance ($735,500). These costs Exhibit the following respective behavior: variable, fixed, and semivariable....
Dundar Mifflin makes electronic products for the RCMP. The following data is for the first six...
Dundar Mifflin makes electronic products for the RCMP. The following data is for the first six months: Direct Labor Hours Manufacturing Overhead January 45,000 $295,000 February 65,000 $309,000 March 57,000 $323,000 April 58,000 $320,000 May 25,000 $181,000 June 29,000 $162,500 Required: 1. Use the high-low method to estimate the cost formula 2. Estimate the total overhead cost at an activity level of 40,000 machine hours, using the separate estimates you obtained for its components.
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT