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3 years ago

Using High-Low to Calculate Predicted Total Variable Cost and Total Cost for a Time Period that Differs from the Data Period

Business

1 answer:

Alex17521 [72]3 years ago

8 0

Answer:

Instructions are listed below.

Explanation:

Giving the following information:

Data for the past 8 months were collected:

Month Labor Cost Employee Hours

January $7,000 360

February $8,140 550

March $9,899 630

April $9,787 610

May $8,490 480

June $7,450 350

July $9,490 570

August $7,531 310

Total Labor Cost = $5,237 + ($7.40 x Employee Hours)

1) To calculate the variable cost we need to use the following formula:

Variable cost per unit= (Highest activity cost - Lowest activity cost)/ (Highest activity units - Lowest activity units)

Variable cost per unit= (9,899 - 7,000) / (630 - 310)= $9.06 per unit

2) Fixed costs= Highest activity cost - (Variable cost per unit * HAU)

Fixed costs= 9,899 - (9.06*630)= $4,191

Fixed costs= LAC - (Variable cost per unit* LAU)

Fixed costs= 7,000 - (9.06*310)= $4,191

3) direct labor hours= 4,000

Total Labor Cost = $5,237 + ($7.40 x Employee Hours)

Total Labor Cost= 5,237 + (7.4*4,000)= $34,837

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Winkle Corporation uses the FIFO method in its process costing system. Beginning inventory in the mixing processing center consi

Mice21 [21]

Answer:

d. 6,700 units

Explanation:

The computation of the equivalent units for conversion cost by using the FIFO method is shown below:

= Beginning inventory units × remaining percentage + units started and completed + ending inventory units × completion percentage

= 5,000 × 10% + (10,000 - 5,000) + 2,000 × 60%

= 500 + 5,000 + 1,200

= 6,700 units

We simply applied the above formula

6 0

3 years ago

A company pays each of its two office employees each Friday at the rate of $100 per day each for a five-day week that begins on

MatroZZZ [7]

<h3>Answer:</h3>

Debiting salaries Expense $400 and Crediting Salaries payable $400.

<h3>Explanation:</h3>

We are given;

1 employees earns $ 100 a day

Therefore;

2 employees will earn $ 200 a day

The month ends on Tuesday, but the two employees works on Monday and Tuesday.

Therefore, the month-end adjusting entry to record will be the amount earned by the two employees on the two days.

Two employees for 2 days = $200/day × 2 days

= $400

But, salary is an expense, and in the accounts an increase in expense account is debited.

According to the rule of double entry, an increase in salaries expense decreases the salaries payable. Therefore, we debit salaries expense account and credit salaries payable account.

Therefore, the month-end adjusting entry to record the salaries earned but unpaid would be;

Debiting salaries Expense $400 and Crediting Salaries payable $400.

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3 years ago

The Oriole Acres Inn is trying to determine its break-even point during its off-peak season. The inn has 50 rooms that it rents

vfiekz [6]

Answer:

Break-even point in units= 402 rooms a month

Explanation:

Giving the following information:

The inn has 50 rooms that it rents at $100 a night. Operating costs are as follows:

Salaries $7,500 per month

Utilities $1,500 per month

Depreciation $1,300 per month

Maintenance $1,760 per month

Maid service $24 per room

Other costs $46 per room

<u>First, we need to calculate the total fixed costs and the unitary variable cost.</u>

Total fixed costs= salaries + utilities + depreciation + maintenance

Total fixed costs= $12,060

Unitary variable cost= 24 + 46= $70

<u>To calculate the break-even point in units, we need to use the following formula:</u>

Break-even point in units= fixed costs/ contribution margin per unit

Break-even point in units= 12,060/ (100 - 70)

Break-even point in units= 402 rooms a month

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3 years ago

A payday loan company charges 6.00 percent interest for a two-week period. What is the annual interest rate? (Do not round inter

Mashcka [7]

Answer:

The annual interest rate is 156 percent

Explanation:

If 6.00 percent interest for a two-week period then annual interest rate =

rate for a two-week period * (52 weeks/ 2 weeks) = 0,06 * 26 = 1,56

1,56 * 100 = 156 percent for a year period

<u>Note</u>: One year have 52 weeks

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3 years ago

Culver Corporation purchased machinery on January 1, 2022, at a cost of $288,000. The estimated useful life of the machinery is

Digiron [165]

Answer:

Instructions are below.

Explanation:

Giving the following information:

Purchasing price= $288,000

Useful life= 4 years

Salvage value= $33,800

First, we will calculate the depreciation expense using the straight-line method:

Annual depreciation= (original cost - salvage value)/estimated life (years)

Annual depreciation= (288,000 - 33,800)/4

Annual depreciation= $63,550

Now, using the double-declining balance:

Annual depreciation= 2*[(book value)/estimated life (years)]

Year 1= 2*63,550= 127,100

Year 2= [(254,200 - 127,100)/4]*2= $63,550

Year 3= [(127,100 - 63,550)/4]*2= $31,775

Year 4= [(63,550 - 31,775)/]*2= $15,887.5

6 0

3 years ago