The manufacturing overhead budget at cutchin Corporation is based on budgeted di

Question

The manufacturing overhead budget at cutchin Corporation is based on budgeted direct labor-hours. The direct labor budget indicates that 2,500 direct labor-hours will be required in September. The variable overhead rate Is $5 per direct labor-hour. The company's budgeted fixed manufacturing overhead is $43,010 per month, which includes depreciation of $3,750. All other fixed manufacturing overhead costs represents current cash flow. The September cash disbursements for manufacturing overhead on the manufacturing overhead budget should be: $39,260 $12,500 $51,760 $55,510

Explanation / Answer

Direct Labour Hours 2500 Hours Variable Rate $ 5 Per Hour 12500 Fixed Overheads 43010 Less: Depreciation -3750 Fixed Cash Overheads 39260 Total 51760 ( $ 12500+51760) The september cash disbursements for Manufacturing Overheads on the manufacturing overhead budget should be $ 51760 The correct option is C. $ 51760

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