The Smith Company Has the Following Cost Data Pertaining to the Production

question 35

Essay

The Smith Company has the following cost data pertaining to the production of small desks:
$\begin{array}{ccc} \text { Units Produced } & \text { Direct Labour Costs } & \text { Overhead Costs } \\\hline 150 & \$ 1,600 & \$ 2,800 \\ 120 & 1,500 & 2,570 \\ 210 & 1,750 & 2,910 \\190 & 1,700 & 2,850 \\140 & 1,600 & 2,600 \\\end{array}$
a.Plot the preceding direct labour costs and overhead costs using the scatterplot method.Overhead costs should be on the vertical axis.
b.Compute the fixed and variable components of the overhead costs using the high-low method.