Churchill Company has the following information available regarding costs at various levels of monthly production:
Required:

\begin{array}{lrr}\text { Production volume } & 7,000 & 10,000 \\\text { Direct materials } & \$ 70,000 & \$ 100,000 \\\text { Direct labour } & 56,000 & 80,000 \\\text { Indirect materials } & 21,000 & 30,000 \\\text { Supervisors' salaries } & 12,000 & 12,000\\\text { Depreci ation on plant } & 10,000 & 10,000 \\\text { Maintenance } & 32,000 & 44,000 \\\text { Utilities } & 15,000 & 21,000 \\\text { Insurance on plant and equipment } & 1,600 & 1,600 \\\text { Property taxes on plant } & 2,000 & 2,000 \\\text { Total } & \$ 219,600 & \$ 300,600 \\\end{array}

$Churchill Company has the following information available regarding costs at various levels of monthly production: Required: \begin{array}{lrr} \text { Production volume } & 7,000 & 10,000 \\ \text { Direct materials } & \$ 70,000 & \$ 100,000 \\ \text { Direct labour } & 56,000 & 80,000 \\ \text { Indirect materials } & 21,000 & 30,000 \\ \text { Supervisors' salaries } & 12,000 & 12,000\\\text { Depreci ation on plant } & 10,000 & 10,000 \\ \text { Maintenance } & 32,000 & 44,000 \\ \text { Utilities } & 15,000 & 21,000 \\ \text { Insurance on plant and equipment } & 1,600 & 1,600 \\ \text { Property taxes on plant } & 2,000 & 2,000 \\ \text { Total } & \$ 219,600 & \$ 300,600 \\ \end{array}$

The Following Cost Formula Was Developed Using Monthly Data for Montreal

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