high low method machine hours

The high-low method comprises the highest and the lowest level of activity and comparison of the. Machine Hours 22000 32000 26000 24000 Cost 56000 May June July August Oa.

Compare And Contrast Traditional And Activity Based Costing Systems Principles Of Accounting Volume 2 Managerial Accounting

The companys relevant range of activity varies from a low of 600 machine hours to a high of 1100 machine hours with the following data being available for the first six months.

. Machine Hours Electrical Cost January 4000 3120 February 6000 4460 March 4800 3500. Plant activity is best measured by direct labor hours. Month Maintenance Cost Machine Hours.

The company observed that at 21000 machine hours of activity total maintenance costs averaged 3620 per hour. Use the high-low method to determine the hospitals cost equation using nursing hours as the cost driver. Machine-hours Labor Costs Highest observation of cost driver 400 10000 Lowest observation of cost driver 240 6800 2.

Hotlanta Inc which uses the high-low method to analyze cost behavior has determined that machine hours best explain the companys utilities cost. Hotlanta Inc which uses the high-low method to analyze cost behavior has determined that machine hours best explain the companys utilities cost. Barkoff Enterprises which uses the high-low method to analyze cost behavior has determined that machine hours best explain the companys utilities cost.

11000 76000 58000 66000. The Hunter Company uses the high-low method to estimate the cost function. What is the estimate of the total cost when 300 machine-hours are used.

Barkoff Enterprises which uses the high-low method to analyze cost behavior has determined that machine hours best explain the companys utilities cost. Use the high-low method to estimate the variable and fixed components of this cost. Assuming Cosco Company uses the high-low method of analysis the fixed cost of maintenance would be.

Round the variable cost to the nearest cent y 1310 x 162000 Predict total overhead costs if 25 comma 00025000 nursing hours are predicted for the month. Lets begin by determining the formula that is used to calculate the variable cost slope. The Teal Companys total overhead costs at various levels of activity are presented below.

If Hagler expects to incur 14000 machine hours in January what will be the estimated total production cost using the high-low method. The companys relevant range of activity varies from a low of 600 machine hours to a high of 1100 machine hours with the following data being available for the first six months of the year. Change in cost Change in volume Variable cost slope 는 - X Data table Round the variable cost to the nearest cent Using the high-low method the variable utilities cost per machine hour is 160 Machine Hours 1050 Requirement 2.

The high-low method involves taking the highest level of activity. HIGH-LOW METHOD Key Terms and Concepts to Know Variable Fixed and Mixed Costs. The companys relevant range of activity varies from a low of 600 machine hours to a high of 1200 machine hours with the following data being available for the first six months of the year.

The company has analyzed these costs at the 51300 machine-hours level of activity as follows. Units labor hours machine hours etc and the corresponding total cost figures high-low method only takes two extreme data pairs ie. In cost accounting the high-low method refers to the mathematical technique that is used to separate fixed and variable components that are otherwise part of the historical cost that is mixed in nature ie partially fixed and partially variable.

Where x is the number of burgers sold in a particular month. Fixed Cost Lowest Activity Cost Variable Cost Per Units Lowest Activity Units Fixed cost 3210 23125 78 Fixed Cost 140625. The total predicted overhead costs for the month is 489500.

Uses the highlow method to analyze cost behavior. The highest and the. The companys relevant range of activity varies from a low of 600 machine hours to a high of 1200 machine hours with the following data being available for the first six months of the year.

Based on the following information calculate fixed costs per month using the high-low method. High-Low method is one of the several mathematical techniques used in managerial accounting to split a mixed cost into its fixed and variable components. So basically Total cost equation is given by 23125x 140625.

In cost accounting a way of attempting to separate out fixed and variable costs given a limited amount of data. Low High Machine-hours 51300 68400 Total factory overhead costs 222690 pesos 244920 pesos-----The factory overhead costs above consist of indirect materials rent and maintenance. Haglers Toupees has the following machine hours and production costs for the last six months of last year.

Machine-Hours Maintenance Costs Highest observation of cost driver 140000 280000 Lowest observation of cost driver 95000 190000 Difference 45000 90000 Maintenance costs a b Machine-hours Slope coefficient b 90000 45000 2 per machine-hour Constant a 280000 280000 0 or Constant a 190000. Given a set of data pairs of activity levels ie. 1 CALCULATE VARIABLE UTILITIES COST PER MACHINE HOUR.

The information for 20x3 is provided below. Assume that the relevant range includes all of the activity levels mentioned in this problem. Compute the variable component rounding off to the nearest whole cent.

The cost of electricity was 18000 in the month when its highest activity was 120000 machine hours MHs. Be sure to use the MHs that occurred between the meter reading dates appearing on the bill The cost of electricity was 16000 in the. Since you have the total cost equation now you can use this to.

Variable utilities cost per machine hour Change in costhigh machine hour-low machine hour 4076-33881460-1030 Variable utilities cost per machine hour 16 per machine hour 2 Fixed cost Total cost-variable cost 3388- 103016 Fixed cost 1740. Indirect materials variable 56430 pesos Rent fixed 129000 Maintenance mixed 37260. C 14330 d 26745 7.

At an activity level of 8300 machine-hours in a month B Companys total variable maintenance cost is 220448 and its total fixed maintenance cost is. Month Direct Labor Hours Maintenance Cost January 1700 14300. When activityjumped to 25000 machine hours which was still within the relevant range the average total cost per machine hour was 3140.

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