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Candilicious Company budgeted the following costs for anticipatedproduction for

ID: 2433838 • Letter: C

Question

Candilicious Company budgeted the following costs for anticipatedproduction for July 2009:

Advertising Expenses - $275,000
Manufacturing Supplies - $14,000
Power and Light - $42,000
Sales Commissions - $290,000
Factory Insurance - $23,000
Production Supervisor Wages - $125,000
Production Control Salaries - $33,000
Executive Officer Salaries - $205,000
Materials Management Salaries - $29,000
Factory Depreciation - $17,000

Prepare a Factory O/H Cost Budget, separating Variable andFixed Costs. Assume that Factory Insurance and Depreciation are theonly Factory Fixed Costs. ?

Explanation / Answer

Amount

$14,000

$42,000

$125,000

$33,000

$29,000

$243,000

$23,000

$17,000

$40,000

$283,000

Variable Overhead Cost

Amount

   Manufacturing Supplies

$14,000

   Power and Light

$42,000

   Production Supervisor Wages

$125,000

   Production Control Salaries

$33,000

   Materials Management Salaries

$29,000

            TotalVariable Factory Overhead Cost

$243,000

Fixed Overhead Cost    Factory Insurance

$23,000

   Factory Depreciation

$17,000

            TotalFixed Factory Overhead Cost

$40,000

Total Factory Overhead Cost

$283,000

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