Birch Canvas and Tarp Manufactures Canvas Products in a Highly

question 18

Essay

Birch Canvas and Tarp manufactures canvas products in a highly automated assembly plant in Edmonton, Alberta. Their automated system is in its first year of operation, and management is still unsure of the best way to estimate the overhead costs of operations for budgetary purposes. For the first six months of operations the following data were collected:
Required:
a. Compute a cost estimating equation for each predictor variable (machine-hours and kilowatt-hours) using the high-low method.
b. For July the company ran the machines for 1,600 hours and used 2,075,000 kilowatt hours of power. The overhead costs totalled $95,000. Which driver was the best predictor for July?

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Definitions:

Business Compulsion

A scenario where a business is forced to make a decision or take an action due to external pressures or unavoidable circumstances.

Fraud

Involves intentionally deceiving someone for personal gain or to damage another individual.

Undue Influence

An improper use of power or manipulation by one person over another, leading to an unfair advantage or agreement.

Undue Influence Case

Legal cases concerning situations where an individual is pressured or coerced into making decisions, not of their free will.