The following information is available regarding the total manufacturing overhead of Bursa Mfg. Co. for a recent four-month period:
- Jan Machine hours: 5600 Manufacturing overhead: $300,000
- Feb Machine hours: 3200 Manufacturing overhead: $224,000
- Mar Machine hours: 4900 Manufacturing overhead: $263,800
- Apr Machine hours: 2900 Manufacturing overhead: $190,000
a-1 Use the high-low method to determine the variable element of manufacturing overhead costs per machine-hour.Manufacturing overhead coast $ per machine hour
a-2 Use the high-low method to determine the fixed element of monthly overhead cost.Fixed element of manufacturing overhead $
b. Bursa expects machine-hours in May to equal 5,300. Use the cost relationships determined in part a to forecast May's manufacturing overhead costs.Estimated manufacturing overhead $
c. Suppose Bursa had used the cost relationships determined in part a to estimate the total manufacturing overhead expected for the months of February and March. By what amounts would Bursa have over- or underestimated these cost?