Felinas Inc. produces floor mats for cars and trucks. The owner, Kenneth Felinas, asked you to assist him in estimating his maintenance costs. Together, Mr. Felinas and you determined that the single best cost driver for maintenance costs was machine hours. Below are data from the previous fiscal year for maintenance expense and machine hours: Maintenance Machine Month Expense Hours $ 3,120 2,200 2 3,310 2,300 3 3,490 2,400 4 3,620 2,430 5 3,620 2,280 3,680 2,440 7 3,610 2,420 8 3,420 2,390 9 3,140 2,210 10 2,880 2,080 11 2,780 1,690 12 2,940 2,070 Using the high-low method, total monthly fixed cost is calculated to be: LO
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- Muffler Incorporated produces floor mats for cars and trucks. The owner, Kenneth Muffler, asked you to assist him in estimating his maintenance costs. Together, Mr. Muffler and you determined that the single best cost driver for maintenance costs was machine hours. Below are data from the previous fiscal year for maintenance expense and machine hours: Month 1 2 3 456789 10 11 12 Maintenance Expense $ 3,280 3,470 3,650 3,780 3,780 4,000 Multiple Choice O $1.44. Using the high-low method, unit variable cost is calculated to be: $1.61. $1.66. 3,770 3,580 3,300 2,960 2,860 3,040 $1.50. Machine Hours 2,280 2,380 2,480 2,510 2,360 2,530 2,500 2,470 2,290 2,160 1,770 2,150Ethan Manufacturing Incorporated produces floor mats for automobiles. The owner, Joseph Ethan, has asked you to assist in estimating maintenance costs. Together, you and Joseph determine that the single best cost driver for maintenance costs is machine hours. These data are from the previous fiscal year for maintenance costs and machine hours: Month Maintenance Costs Machine Hours 1 $ 2,780 1,870 2 2,940 1,950 3 3,090 2,030 4 3,200 2,050 5 3,280 2,080 6 3,250 2,060 7 3,190 2,040 8 3,030 2,020 9 2,800 1,880 10 2,400 1,280 11 2,410 1,480 12 2,630 1,770 Required: 1. What is the cost equation for maintenance costs using the high-low method? 2. Calculate the mean absolute percentage error (MAPE) for the cost equation you developed in requirement 1.Ethan Manufacturing Inc. produces floor mats for automobiles. The owner, Joseph Ethan, has asked you to assist in estimating maintenance costs. Together, you and Joseph determine that the single best cost driver for maintenance costs is machine hours. These data are from the previous fiscal year for maintenance costs and machine hours: Month 1 2345 67 000 8 9 10 11 12 Maintenance Costs $ 2,740 2,900 3,050 3,160 3,240 3,210 3,150 2,990 2,760 2,360 2,370 2,590 Machine Hours 1,830 1,910 1,990 2,010 2,040 2,020 2,000 1,980 1,840 Required 1 Required 2 1,240 1,440 1,730 Required: 1. What is the cost equation for maintenance costs using the high-low method? 2. Calculate the mean absolute percentage error (MAPE) for the cost equation you developed in requirement 1. Complete this question by entering your answers in the tabs below. Calculate the mean absolute percentage error (MAPE) for the cost equation you developed in requirement 1. (Do not round intermediate calculations, with the exception…
- Ethan Manufacturing Incorporated produces floor mats for automobiles. The owner, Joseph Ethan, has asked you to assist in estimating maintenance costs. Together, you and Joseph determine that the single best cost driver for maintenance costs is machine hours. These data are from the previous fiscal year for maintenance costs and machine hours: 1. What is the cost equation for maintenance costs using the high-low method? 2. Calculate the mean absolute percentage error (MAPE) for the cost equation you developed in requirement 1. Month Maintenance Costs Machine Hours 1 $ 2,660 1,750 2 2,820 1,830 3 2,970 1,910 4 3,080 1,930 5 3,160 1,960 6 3,130 1,940 7 3,070 1,920 8 2,910 1,900 9 2,680 1,760 10 2,280 1,160 11 2,290 1,360 12 2,510 1,650Hicks Contracting collects and analyzes cost data in order to track the cost of installing decks on new home construction jobs. The following are some of the costs that they incur. Classify these costs as fixed or variable costs and as product or period costs. Lumber used to construct decks ($12.00 per square foot) Carpenter labor used to construct decks ($10 per hour) Construction supervisor salary ($45,000 per year) Depreciation on tools and equipment ($6,000 per year) Selling and administrative expenses ($35,000 per year) Rent on corporate office space ($34,000 per year) Nails, glue, and other materials required to construct deck (varies per job)The controller of the Blade Company wants you to estimate a cost function from the following two observations in a general ledger account called Maintenance: (Click to view the information.) Required 1. Estimate the cost function for maintenance. 2. Can the constant in the cost function be used as an estimate of fixed maintenance cost per month? Explain. Requirement 1. Estimate the cost function for maintenance. (Round your answers to the nearest cent as needed.) Maintenance costs = Maintenance costs = +( +( X X Requirement 2. Can the constant in the cost function be used as an estimate of fixed maintenance cost per month? Explain. the relevant range, not at cost levels the relevant range. If there are no months with zero The cost function in requirement 1 is an estimate of how costs behave machine-hours represented in the maintenance account, data in that account function provides the best available starting point for a straight line that approximates how a cost behaves be used to…
- Mighty Muffler, Inc. operates an automobile service facility that specializes in replacing mufflers on compact cars. The following table shows the costs incurred during a month when 700 mufflers were replaced.Muffler Replacements600 700 800Total costs:Fixed costs ..................................................................................................... a $56,000 bVariable costs .................................................................................................. c 28,000 dTotal costs .................................................................................................. e $84,000 fCost per muffler replacement:Fixed cost ....................................................................................................... g h iVariable cost ................................................................................................... j k lTotal cost per muffler replacement ............................................................... m n…Hicks Contracting collects and analyzes cost data in order to track the cost of installing decks on new home construction jobs. The following are some of the costs that they incur. Classify these costs as fixed or variable costs and as product or period costs. A. Lumber used to construct decks ($12.00 per square foot) B. Carpenter labor used to construct decks ($10 per hour) C. Construction supervisor salary ($45,000 per year) D. Depreciation on tools and equipment ($6,000 per year) E. Selling and administrative expenses ($35,000 per year) F. Rent on corporate office space ($34,000 per year) G. Nails, glue, and other materials required to construct deck (varies per job)Mighty Muffler, Incorporated, operates an automobile service facility that specializes in replacing mufflers on compact cars. The following table shows the costs incurred during a month when 900 mufflers were replaced. Note: Round "cost per muffler" to 2 decimal places. Required: Fill in the missing amounts. Total costs: Fixed costs Variable costs Total costs Cost per muffler replacement: Fixed cost Variable cost Total cost per muffler replacement $ 800 Muffler Replacements $ $ 103.50 $ $ 900 82,800 46,800 129,600 $ 92.00 52.00 144.00 $ 1000 82.80 134.80
- Mighty Muffler, Inc. operates an automobile service facility that specializes in replacing mufflers on compact cars. The following table shows the costs incurred during a month when 600 mufflers were replaced. Required: Fill in the missing amounts, labeled (a) through (o), in the table.4. Hicks Contracting collects and analyzes cost data in order to track the cost of installing decks on new home construction jobs. The following are some of the costs that they incur. Classify these costs as fixed or variable costs and as product or period costs. Costs Variable / Fixed Product / Period Lumber used to construct decks ($12.00 per square foot) Carpenter labor used to construct decks ($10 per hour) Construction supervisor salary ($45,000 per year) Depreciation on tools and equipment ($6,000 per year) Selling and administrative expenses ($35,000 per year) Rent on corporate office space ($34,000 per year) Nails, glue, and other materials required to construct deck (varies per job)Chips Co., maker of computers, incurred the following cost during the year. Is the following cost item a fixed or variable cost? Advertising in a newspaper monthly Variable O Fixed