Angie March owns a catering company that stages banquets and parties for both individuals and companies. The business is seasonal, with heavy demand during the summer months and year-end holidays and light demand at other times. Angie has gathered the following cost information from the past year: Month Labor Hours Overhead Costs January 2,800 $51,840 February 2,100 49,120 March 2,200 50,120 April 3,300 53,640 May 3,600 56,520 June 4,800 60,040 July 7,100 68,120 August 6,800 65,240 September 5,700 60,680 October 3,800 57,440 November 2,400 52,000 December 5,800 61,640 Total 50,400 $686,400 (a) Correct answer icon Your answer is correct. Identify the high and low points. Activity Level $ High point enter the activity level for high point $enter the high point in dollars Low point enter the activity level for low point $enter the low point in dollars Using the high-low method, compute the overhead cost per labor hour and the fixed overhead cost per month. (Round variable cost to 2 decimal places, e.g. 15.25 and fixed cost to 0 decimal places, e.g. 5,275.) Variable cost = $enter the variable cost per labor hour in dollars rounded to 2 decimal places per labor hour Fixed cost = $enter the fixed cost amount in dollars rounded to 0 decimal places eTextbook and Media Attempts: 1 of 3 used (b) Incorrect answer icon Your answer is incorrect. Angie has booked 4,200 labor hours for the coming month. How much overhead should she expect to incur? Total cost = $enter the total cost amount in dollars rounded to 0 decimal places eTextbook and Media Save for Later Attempts: 1 of 3 used Submit Answer (c) If Angie books one more catering job for the month, requiring 350 labor hours, how much additional overhead should she expect to incur? Additional overhead = $enter the additional overhead amount in dollars rounded to 0 decimal places
Angie March owns a catering company that stages banquets and parties for both individuals and companies. The business is seasonal, with heavy demand during the summer months and year-end holidays and light demand at other times. Angie has gathered the following cost information from the past year: Month Labor Hours Overhead Costs January 2,800 $51,840 February 2,100 49,120 March 2,200 50,120 April 3,300 53,640 May 3,600 56,520 June 4,800 60,040 July 7,100 68,120 August 6,800 65,240 September 5,700 60,680 October 3,800 57,440 November 2,400 52,000 December 5,800 61,640 Total 50,400 $686,400 (a) Correct answer icon Your answer is correct. Identify the high and low points. Activity Level $ High point enter the activity level for high point $enter the high point in dollars Low point enter the activity level for low point $enter the low point in dollars Using the high-low method, compute the overhead cost per labor hour and the fixed overhead cost per month. (Round variable cost to 2 decimal places, e.g. 15.25 and fixed cost to 0 decimal places, e.g. 5,275.) Variable cost = $enter the variable cost per labor hour in dollars rounded to 2 decimal places per labor hour Fixed cost = $enter the fixed cost amount in dollars rounded to 0 decimal places eTextbook and Media Attempts: 1 of 3 used (b) Incorrect answer icon Your answer is incorrect. Angie has booked 4,200 labor hours for the coming month. How much overhead should she expect to incur? Total cost = $enter the total cost amount in dollars rounded to 0 decimal places eTextbook and Media Save for Later Attempts: 1 of 3 used Submit Answer (c) If Angie books one more catering job for the month, requiring 350 labor hours, how much additional overhead should she expect to incur? Additional overhead = $enter the additional overhead amount in dollars rounded to 0 decimal places
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
Angie March owns a catering company that stages banquets and parties for both individuals and companies. The business is seasonal, with heavy demand during the summer months and year-end holidays and light demand at other times. Angie has gathered the following cost information from the past year:
Month
|
Labor Hours
|
|
|||||||
---|---|---|---|---|---|---|---|---|---|
January
|
2,800 | $51,840 | |||||||
February
|
2,100 | 49,120 | |||||||
March
|
2,200 | 50,120 | |||||||
April
|
3,300 | 53,640 | |||||||
May
|
3,600 | 56,520 | |||||||
June
|
4,800 | 60,040 | |||||||
July
|
7,100 | 68,120 | |||||||
August
|
6,800 | 65,240 | |||||||
September
|
5,700 | 60,680 | |||||||
October
|
3,800 | 57,440 | |||||||
November
|
2,400 | 52,000 | |||||||
December
|
5,800 | 61,640 | |||||||
Total
|
50,400 | $686,400 |
(a)
Correct answer icon
Your answer is correct.
Identify the high and low points.
Using the high-low method, compute the overhead cost per labor hour and the fixed overhead cost per month. (Round variable cost to 2 decimal places, e.g. 15.25 and fixed cost to 0 decimal places, e.g. 5,275.)
Activity Level | $ | |||
---|---|---|---|---|
High point
|
enter the activity level for high point | $enter the high point in dollars | ||
Low point
|
enter the activity level for low point | $enter the low point in dollars |
Using the high-low method, compute the overhead cost per labor hour and the fixed overhead cost per month. (Round variable cost to 2 decimal places, e.g. 15.25 and fixed cost to 0 decimal places, e.g. 5,275.)
Variable cost
|
= | $enter the variable cost per labor hour in dollars rounded to 2 decimal places | per labor hour |
---|---|---|---|
Fixed cost
|
= | $enter the fixed cost amount in dollars rounded to 0 decimal places |
eTextbook and Media
Attempts: 1 of 3 used
(b)
Incorrect answer icon
Your answer is incorrect.
Angie has booked 4,200 labor hours for the coming month. How much overhead should she expect to incur?
Total cost = | $enter the total cost amount in dollars rounded to 0 decimal places |
eTextbook and Media
Save for Later
Attempts: 1 of 3 used
Submit Answer
(c)
If Angie books one more catering job for the month, requiring 350 labor hours, how much additional overhead should she expect to incur?
Additional overhead = | $enter the additional overhead amount in dollars rounded to 0 decimal places |
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