Flexible Overhead Budget Leno Manufacturing Company prepared the following facto

Question

Flexible Overhead Budget

Leno Manufacturing Company prepared the following factory overhead cost budget for the Press Department for October of the current year, during which it expected to require 9,000 hours of productive capacity in the department:

Assuming that the estimated costs for November are the same as for October, prepare a flexible factory overhead cost budget for the Press Department for November for 7,000, 9,000, and 11,000 hours of production. Round your interim computations to the nearest cent, if required. Enter all amounts as positive numbers.

Variable overhead cost:    Indirect factory labor $79,200    Power and light 4,050    Indirect materials 21,600       Total variable overhead cost $104,850 Fixed overhead cost:    Supervisory salaries $36,700    Depreciation of plant and equipment 23,070    Insurance and property taxes 14,680       Total fixed overhead cost 74,450 Total factory overhead cost $179,300

Explanation / Answer

Answer:

STATEMENT OF FLEXIBLE FACTORY OVERHEAD COST BUDGET FOR NOVEMBER

NOTE: Variable expenses will vary with variation in hours worked but fixed overhead costs will remain fixed in all situations.

DIRECT LABOUR HOURS 7000 HRS 9000HRS 11000HRS VARIABLE OVERHEAD COST INDIRECT FACTORY LABOUR $61600 $79200 $96800 POWER AND LIGHT $3150 $4050 $4950 INDIRECT MATERIALS $16800 $21600 $26400 TOTAL VARIABLE FACTORY OVERHEAD $81550 $104850 $128150 FIXED OVERHEAD COST SUPERVISORY SALARIES $36700 $36700 $36700 DEPROICIATION OF PLANT $23070 $23070 $23070 INSURANCE AND PROPERTY TAX $14680 $14680 $14680 TOTAL FIXED OVER HEAD $74450 $74450 $74450 TOTAL FACTORY OVERHEAD $156000 $179300 $202600

Related Questions

Navigate

• Browse (All)
• Browse F
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.