X Company wants to estimate overhead costs in March, when production is expected to be 1,500...

X Company wants to estimate overhead costs in March, when production is expected to be 1,500 units. To determine the parameters of its overhead cost function, it used account analysis with the January cost information below and when production was was 1,000 units.

	Total	Total Variable
Utilities	$44,000	$44,000
Maintenance	57,000	27,360
Supervision	22,000	0

Using the resulting cost function, what is X Company's estimate of total overhead costs in March?

Expert Solution

Calculations	A	B	C = A - B	D = B / Number of units (1,000)	E = D x Number of units of March (1,500)	F = E+C
Particulars	Total cost	Variable cost	Fixed cost	Variable cost per unit	Variable cost for March	Total costs
Utilities	44,000	44,000	-	44	66000	66,000
Maintenance	57,000	27,360	29,640	27.36	41040	70,680
Supervision	22,000	-	22,000	0	0	22,000
				Total overhead March		1,58,680

ekkarill92 answered 1 year ago

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X Company wants to estimate overhead costs in March, when production is expected to be 1,500...

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