The Following Data Were Taken from the Accounting Records of Guild

question 32

Essay

The following data were taken from the accounting records of Guild Corporation:
$\begin{array} { l c c } \\underline {\text { Month }} & \begin{array} { c } \text { Machine } \\\underline {\text { Hours }}\end{array} & \begin{array} { c } \text { Manufacturing } \\\underline {\text { Overhead }}\end{array} \\\text { August } & 46,000 & \$ 889,000 \\\text { September } & 60,000 & 1,130,000 \\\text { October } & 78,000 & 1,300,000 \\\text { November } & 62,000 & 1,000,000\end{array}$ October's costs consisted of machine supplies ($190,000), property taxes ($30,000), and plant maintenance ($1,080,000). These costs exhibit the following respective behaviour: variable, fixed, and semi-variable.
Required:
A. Determine the machine supplies and property taxes for August. Round all calculations to two decimal places.
B. By using the high-low method, analyze Guild's plant maintenance cost and calculate the monthly fixed portion and the variable cost per machine hour.
C. Assume that present cost behaviour patterns continue into future months. Estimate the total amount of manufacturing overhead Guild can expect in December if 56,000 machine hours are worked.

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Definitions:

Lower-Level Needs

Basic physiological and safety needs in Maslow's hierarchy, which must be satisfied before higher-level needs for love, esteem, and self-actualization can be addressed.

Self-Actualization

A concept in humanistic psychology referring to the realization or fulfillment of one's talents and potentialities, considered as a drive or need present in everyone.

External Locus of Control

The belief that one's outcomes in life are controlled by external factors beyond their personal control.

Human Agency

The capacity of individuals to act independently and make choices, influencing their environment and their own lives.