Nova Company's total overhead cost at various levels of activity are presented below: Month Machine- Hours Total Overhead Cost April 52,500 $ 205,200 May 42,000 $ 180,000 June 63,000 $ 230,400 July 73,500 $ 255,600 Assume that the total overhead cost above consists of utilities, supervisory salaries, and maintenance. The breakdown of these costs at the 42,000 machine-hour level of activity is: Utilities $ 54,600 Supervisory salaries 64,000 Maintenance 61,400 Total overhead cost $ 180,000 Nova Company's management wants to break down the maintenance cost into its variable and fixed cost elements. Requirement 1: Estimate how much of the $255,600 of overhead cost in July was maintenance cost.
Maintenance cost $ Requirement 2: Using the high-low method, estimate a cost formula for maintenance. Y = $ + $ X Requirement 3: Express the company's total overhead cost in the linear equation form Y = a +bX. Y = $ + $ X Requirement 4: What total overhead cost would you expect to be incurred at an operating activity level of 46,200 machine-hours? Total overhead costs $ check my workeBook Links