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2. Using the high-low method, estimate a cost formula for maintenance. (Round the variable cost per DLH to 2 decimal places.) Direct Labor Maintenance Hours Cost High level of activity Low level of activity Change 0 per DLH Variable cost element Fixed cost element Y = 3. What total factory overhead costs would you expect the company to incur at an operating level of 58,740 direct labor-hours? (Do not round intermediate calculations.) Total factory overhead cost Sawaya Co., Ltd., of Japan is a manufacturing company whose total factory overhead costs fluctuate considerably from year to year according to increases and decreases in the number of direct labor-hours worked in the factory. Total factory overhead costs at high and low levels of activity for recent years are given below: Level of Activity Low High 53,400 71,200 $ 249, 140 $ 277,620 Direct labor-hours Total factory overhead costs The factory overhead costs above consist of indirect materials, rent, and maintenance. The company has analyzed these costs at the 53,400-hour level of activity as follows: Indirect materials (variable) Rent (fixed) Maintenance (mixed) Total factory overhead costs $ 58,740 130,000 60,400 $ 249,140 To have data available for planning, the company wants to break down the maintenance cost into its variable and fixed cost elements. Required: 1. Estimate how much of the $277,620 factory overhead cost at the high level of activity consists of maintenance cost. (Hint: To do this, it may be helpful to first determine how much of the $277,620 consists of indirect materials and rent. Think about the behavior of variable and fixed costs!) (Do not round intermediate calculations.) Maintenance cost at high level of activity

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