The XYZ Tool Manufacturing Co. shows the following factory overhead costs at various levels of direct labor hours for the last four months:
|
Direct Labor |
Factory |
|
|
Month |
Hours x |
Overhead y |
|
July |
2,500 hours |
$ 7,000 |
|
August |
1,500 |
5,000 |
|
September |
2,000 |
6,000 |
|
October |
3,000 |
8,000 |
|
9,000 hours |
$26,000 |
Determine the monthly fixed overhead and the variable overhead rate per direct labor hour (DLH) using (a) the scattergraph method and (b)the high low method.