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-   -   Accounting total overhead cost using high-low method? (https://www.askmehelpdesk.com/showthread.php?t=565126)

  • Mar 25, 2011, 04:29 AM
    Don_M
    Accounting total overhead cost using high-low method?
    ABC Co.'s total overhead costs at various levels of activities (all within the same relevant range) are presented below:

    Month Flying Hours Total Overhead Costs
    September 8,000 $ 92,000
    October 12,000 $ 106,000
    November 16,000 $ 120,000
    December 4,000 $ 78,000



    Assume that the total overhead costs above consist of managerial salaries, maintenance and utilities.
    The breakdown of these costs at the 4,000 flying-hour level of activity is:
    Managerial salaries (fixed) $

    $25,000
    Maintenance (mixed) $48,200
    Utilities (variable) $4,800
    Total overhead costs
    $ 78,000



    ABC Co.'s management wants to breakdown the maintenance cost into its variable and fixed cost elements.

    Required:

    1) Estimate how much of the $120,000 of overhead cost in November was maintenance cost.

    2) Using the high-low method, estimate a cost formula for maintenance.

    3) Express the company's total overhead costs in the linear equation form Y=aX+b.

    4) What total overhead costs would be expected to be incurred at an operating activity level of 11,000 flying-hours?
  • Mar 25, 2011, 05:56 AM
    smoothy

    Read me first - Expectations for the Homework Help board

    --------------------------------------------------------------------------------

    We won't do your homework questions for you.
    You were given the assignment for you to learn.
    There are plenty of resources on the web for you to research this.

    If you come up with your own answer and post it for us to critique that is within reason.
    If you have some SPECIFIC questions that you couldn't find or didn't understand, we may help with that.
    But this is your assignment, show us you have at least attempted to complete it on your own.
    Thank you.
  • Mar 26, 2011, 04:41 AM
    Don_M
    Bro this was not a homework question :)

    It was a question from the book that I was working on for my test but didn't know how to solve it and couldn't ask my prof seeing that in my country ( Friday & Saturday ) is a weekend :)



    I got it solved anyway

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