From April 1 through October 31, Coles County Highway Department hires temporary employees to mow and clean the right-of-way along county roads. The County Road Commissioner has asked you to help her in determining the variable labor cost of mowing and cleaning a mile of road. The following information is available regarding current-year operations: Month April May June July August September October Miles Mowed Labor and Cleaned Costs 240 $6,800 305 7,680 325 8.310 275 7.200 220 6,550 200 5.760 75 4,960 Use the information from the high- and low-volume months to develop a cost-estimating equation for monthly labor costs. Monthly labor costs - $ 3,955+ S Plot the data on a scatter Monthly labor costs - $ 13.4 X ✔ diagram. Using the information from representative high- and low volume months, use the high-low method to develop a cost-estimating equation for monthly labor costs. 8.310 x $ 13.4 x X
From April 1 through October 31, Coles County Highway Department hires temporary employees to mow and clean the right-of-way along county roads. The County Road Commissioner has asked you to help her in determining the variable labor cost of mowing and cleaning a mile of road. The following information is available regarding current-year operations: Month April May June July August September October Miles Mowed Labor and Cleaned Costs 240 $6,800 305 7,680 325 8.310 275 7.200 220 6,550 200 5.760 75 4,960 Use the information from the high- and low-volume months to develop a cost-estimating equation for monthly labor costs. Monthly labor costs - $ 3,955+ S Plot the data on a scatter Monthly labor costs - $ 13.4 X ✔ diagram. Using the information from representative high- and low volume months, use the high-low method to develop a cost-estimating equation for monthly labor costs. 8.310 x $ 13.4 x X
Managerial Accounting: The Cornerstone of Business Decision-Making
7th Edition
ISBN:9781337115773
Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Chapter4: Job-order Costing And Overhead Application
Section: Chapter Questions
Problem 42E: Source Documents For each of the following independent situations, give the source document that...
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Step 1: High-low method:
VIEWStep 2: Use the information from the high- and low-volume months to develop a cost-estimating equation:
VIEWStep 3: Plot the data on a scatter diagram:
VIEWStep 4: Adjust the equation developed in req (b) that effect of an anticipated 5% increase in wages:
VIEWStep 5: Adjust the equation developed in (b) to incorporate the effect of an 5% increase in wages:
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