Calculate the Variable Cost using the high-low method.

The manager of the main laboratory facility at UrbanFit Center is interested in being able to predict the overhead costs each month for the lab. The manager believes that total overhead varies with the number of lab tests performed I that some costs remain the same each month regardless of the number of lab tests performed. The lab manager collected the following data for the first seven months of the year. (Click the icon to view the data.) Use the high-low method to determine the laboratory's cost equation for total laboratory overhead. Use your results to predict total laboratory overhead if 3,500 lab tests are performed next month. Let's begin by determining the formula that is used to calculate the variable cost (slope). Data table Variable cost (slope) Number of Lab Month Tests Performed Total Laboratory Overhead Costs January 2,800 $21,500 February 2,600 $22,700 March 3,100 $27,900 April.... 3,550 $31,400 May 3,700 $28,500 June.. 1,200 $19,500 July 1,400 $14,500 Print Done X

Benson Corporation estimated its overhead costs would be $22,500 per month except for January when it pays the $153,120 annual insurance premium on the manufacturing facility. Accordingly, the January overhead costs were expected to be $175,620 ($153,120 + $22,500). The company expected to use 7,900 direct labor hours per month except during July, August, and September when the company expected 9,100 hours of direct labor each month to build inventories for high demand that normally occurs during the Christmas season. The company's actual direct labor hours were the same as the estimated hours. The company made 3,950 units of product in each month except July, August, and September, in which it produced 4,550 units each month. Direct labor costs were $24.70 per unit, and direct materials costs were $10.00 per unit. Required a. Calculate a predetermined overhead rate based on direct labor hours. b. Determine the total allocated overhead cost for January, March, and August. c. Determine…

Blossom Services, Inc. is trying to establish the standard labor cost of a typical brake repair. The following data have been collected from time and motion studies conducted over the past month. Actual time spent on the brake repairs Hourly wage rate Payroll taxes Setup and downtime Cleanup and rest periods Fringe benefits (a) 1 hour $11 10% of wage rate 5% of actual labor time 25% of actual labor time 20% of wage rate Determine the standard direct labor hours per brake repairs. (Round answer to 2 decimal places, eg. 1.25.) Standard direct labor hours per brake repair hours F