WileyPLUS Exercise 22-3 Exercise 22-3 Myers Company uses a flexible budget for m

Question

WileyPLUS Exercise 22-3 Exercise 22-3 Myers Company uses a flexible budget for manufacturing overhead based on direct labor hours. Variable manufacturing overhead costs per direct labor hour are as follows. Indirect labor Indirect materials Utilities $1.10 0.70 0.20 Fixed overhead costs per month are supervision 4,000, Depreciation $1,500, and Property Taxes $700 The company believes it will normally operate in a range of 6,400-10,000 direct labor hours per month. Prepare a monthly manufacturing overhead flexible budget for 2017 for the expected range of activity, using increments of 1,200 direct labor hours. (List variable costs before fixed costs.) MYERS COMPANY Monthly Manufacturing Overhead Flexible Budget For the Year 2017 Click if you would like to Show Work for this question: Open Show Work

Explanation / Answer

Flexible budget :

Activity level Direct labour hours 6400 7600 8800 10000 Variable cost Indirect labour 7040 8360 9680 11000 Indirect material 4480 5320 6160 7000 Utilities 1280 1520 1760 2000 Total variable cost 12800 15200 17600 20000 Fixed cost Supervision 4000 4000 4000 4000 Depreciation 1500 1500 1500 1500 Property taxes 700 700 700 700 Total fixed cost 6200 6200 6200 6200 Total cost 19000 21400 23800 26200

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