The following data is the cost information for company A over a period for output level of 10000units; direct materials-2kg @ GHC5/kg, direct labour- 2hours @ GHC20/hour, production overheads of GHC40000, supervisors' salary amounting to GHC30000. The company also has a machine at cost of GHC100000 to be used for ten years. The accountant identifies that one-third of supervisors' salary varies with output levels whiles 60% of production overheads remains constant as output changes. Using the accounts classification method, the estimated cost function is OA.C = 54000 + 52.6x OB. C = 45000 + 44.2x OC.C = 45000 + 52.4x OD.C= 40000 + 42.6x

The following data is the cost information for company A over a period for output level of 10000units; direct materials-2kg @ GHC5/kg, direct labour- 2hours @ GHC20/hour, production overheads of GHC40000, supervisors' salary amounting to GHC30000. The company also has a machine at cost of GHC100000 to be used for ten years. The accountant identifies that one-third of supervisors' salary varies with output levels whiles 60% of production overheads remains constant as output changes. Using the accounts classification method, the estimated cost function is OA.C = 54000 + 52.6x OB. C = 45000 + 44.2x OC.C = 45000 + 52.4x OD.C= 40000 + 42.6x

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Description: The following data is the cost information for company A over a period for output level of 10000units; direct materials-2kg@ GHC5/kg, direct labour- 2hours @ GHC20/hour, production overheads of GHC40000, supervisors' salary amounting toGHC30000. The

Managerial Accounting

15th Edition

ISBN:9781337912020

Author:Carl Warren, Ph.d. Cma William B. Tayler

Publisher:Carl Warren, Ph.d. Cma William B. Tayler

Chapter6: Cost-volume-profit Analysis

Section: Chapter Questions

Problem 2CMA

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