Mountain Manufacturing Inc. ran its machines in March, a slow month, for 410 hours for a total cost of $63,000. In July, a peak month, the freezer ran for 756 hours for a total cost of $92,800.
Required:
a.What is the cost estimating equation for the department if hours of freezer use are used as the cost driver?
b.What is the estimated total cost at an operating level of 600 hours?

Question

Quizplus · Accepted Answer

The Answer of Mountain Manufacturing Inc. ran its machines in March, a slow month, for 410 hours for a total cost of $63,000. In July, a peak month, the freezer ran for 756 hours for a total cost of $92,800.
Required:
a.What is the cost estimating equation for the department if hours of freezer use are used as the cost driver?
b.What is the estimated total cost at an operating level of 600 hours?