high low method machine hours

Transfer the information in the table above to an Excel spreadsheet and prepare the solutions to the following questions. High low method machine hours Saturday March 5 2022 Edit.

High Low Method Definition

A manufacturing company estimates semi-variable costs by using the high-low method with machine hours as the cost driver.

. High low method 1 machine hours maintenance costs. Machine hours and electricity costs for IJMAC Industries for 2013 were as follows. Period Semi-Variable Costs Machine Hours 1 100000 22000 2 120000 30000 3 96000 23600 If 29000 machine hours were budgeted for the next period estimated semi-variable costs would total.

The company wants to know the rate at which its electricity cost changes when the number of machine hours change. Using the high-low method of analysis estimate the variable electrical cost per machine hour. Assume that the cost of electricity at a small manufacturing facility is a mixed cost since the company has only one electricity meter for air quality cooling lighting and for its production equipment.

The organization increments salaries and wages by 10 at the start of the 3rd. Solve Y if x 13000. The Month Cost Machine Hours May 8646 2650 June 11157 4000 July 11808 4350 August 10785 3800 If machine hours in October are expected to be.

Using the high-low method determine the overhead cost equation. This preview shows page 21 - 25 out of 55 pages. Your solution should show the appropriate formulas and the detailed calculations.

High Low Method of Machine Hours 8000 10000 11000 9000 14000 12000 Total Maintenance Costs 600000 640000 800000 700000 900000 870000 Required. Machine-hours Labor Costs Highest observation of cost driver 400. A manufacturing company estimates semi-variable costs by using the high-low method with machine hours as the cost driver.

Recent data are shown below. High low method 1 machine hours maintenance costs. Find the fixed cost 3.

Quarter Work hours Cost 1 15000 4000000 2 20000 4800000 3 18000 4400000 4 21000 5000000. 3 Total cost on 1220 Machine hour will be 1220161740 3692. 978-0-07-802542-6 PROBLEM 2-21 PAGE 60 PROBLEM 2â 21 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. Given a set of data pairs of activity levels ie. 2 Fixed cost Total cost-variable cost 3388-103016 Fixed cost 1740.

State the cost function 4. Part 1 High-Low Method 12 Points. Based on the following information calculate fixed costs per month using the high-low method.

Pages 55 Ratings 100 3 3 out of 3 people found this document helpful. Use High and low method to estimate Variable cost per unit 2. The Cost function will be.

Machine Hours 22000 32000 26000 24000 Cost 56000 May June July August Oa. High Low Method is a mathematical technique used to determine the fixed and variable elements of historical costs that are partially fixed and partially variable. High Low Method Accounting Meaning Formula Example And More In 2021 Accounting Accounting Principles Accounting Education.

High Low Method In Accounting Definition Formula. Atlanta Inc 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.

Course Title ACC 211. X Company uses the high-low method to estimate total overhead costs each month with machine hours as the activity measure. Company which uses the high-low method to analyze cost behavior has determined that machine hours best predict the companys total utilities cost.

The high-low method involves taking the highest level of activity. The cost of electricity used in a factory is likely to be a mixed cost since some of the electricity will vary with the number of machine hours while some of. Assume that the cost of electricity at a small manufacturing facility is a mixed cost since the company has only one electricity meter for air quality cooling lighting and for its production equipment.

In cost accounting a way of attempting to separate out fixed and variable costs given a limited amount of data. Based on the following information calculate fixed costs per month using the high-low method. Atlanta Inc which uses the high-low method to analyze cost.

The companys cost and machine hour usage data for the first six months of the year follow. 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. The following data are the only records available.

Variable utilities cost per machine hour 16 per machine hour. These are then used to. School The University of Queensland.

The high-low method is a simple technique for computing the variable cost rate and the total amount of fixed costs that are part of mixed costs. Labor hours machine hours etc and the corresponding total cost figures high-low method only takes two extreme data pairs as inputs. Following past monthly cost and activity information is available.

Machine hours and electricity costs for IJMAC Industries for 2013 were as follows. Total costsfixed costsvariable cost. Using the high-low method answer the following questions.

Mixed costs are costs that are partially variable and partially fixed. The total maintenance cost at 25000 machine hours is given as. Example of High-Low Method.

Variable utilities cost per machine hour Change in costhigh machine hour-low machine hour 4076-33881460-1030. Machine Hours Electrical Cost January 4000 3120 February 6000 4460 March 4800 3500 April 5800 5040 May 3600 2900 June 4200 3200 Required. Month Machine-hours Overhead Costs February 1700 20500 March 2800 22250 April 1000 19950 May 2500 21500 June 3500 23950 Required.

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. 247 help from Expert Tutors on 140 subjects.

High Low Method Calculate Variable Cost Per Unit And Fixed Cost