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2010-05-14_025153_sandbag (1)

# 2010-05-14_025153_sandbag (1) - concerning the operations...

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The Wildcat Company has provided the following information: Units of Output 30,000 Units 42,000 Units Direct materials \$ 180,000 \$ 252,000 Workers' wages 1,080,000 1,512,000 Supervisors' salaries 312,000 312,000 Equipment depreciation 151,200 151,200 Maintenance 81,600 110,400 Utilities 384,000 528,000 Total \$2,188,800 \$2,865,600 Using the high-low method and the information provided above, 21. Identify the linear cost function equation and estimate the total cost at 36,000 units of output a. Variable cost = (\$2,865,600 – \$2,188,800) / (42,000 – 30,000) = \$56.40 Fixed cost = \$2,865,600 – \$56.40 x 42,000 = \$496,800 Cost function is y = \$496,800 + \$56.40X b. Output level of 36,000 units = \$496,800 + \$56.40 x 36,000 = = \$2,527,200 total cost As part of his job as cost analyst, Max Thompson collected the following information
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Unformatted text preview: concerning the operations of the Machining Department: Observation Machine-hours Total Operating Costs January 4,000 \$45,000 February 4,600 49,500 March 3,800 45,750 April 4,400 48,000 May 4,500 49,800 22. Use the high-low method to determine the estimating cost function with machine-hours as the cost driver. Slope coefficient = (\$49,500 – \$45,750) / (4,600 – 3,800) = \$4.6875 per machine-hour Constant = \$49,500 - (\$4.6875 x 4,600) = \$27,937.50 Estimating equation = \$27,937.50 + \$4.6875X 23. If June's estimated machine-hours total 4,200, what are the total estimated costs of the Machining Department? I will tip if you answer these three questions June's estimated costs = \$27,937.50 + \$4.6875 x 4,200 = \$47,625...
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