Copper Manufacturing has prepared the following monthly flexible manufacturing o
ID: 2505150 • Letter: C
Question
Copper Manufacturing has prepared the following monthly flexible manufacturing overhead budget for its Mixing Department:
COPPER MANUFACTURING
Monthly Flexible Manufacturing Overhead Budget
Mixing Department
Activity level
Direct labor hours 3,000 4,000
Variable costs
Indirect materials $ 3,000 $ 4,000
Indirect labor 15,000 20,000
Factory supplies 4,500 6,000
Total variable 22,500 30,000
Fixed costs
Depreciation 20,000 20,000
Supervision 12,000 12,000
Property taxes 15,000 15,000
Total fixed 47,000 47,000
Total costs $69,500 $77,000
Instructions
Prepare a flexible budget at the 5,000 direct labor hours of activity.
Explanation / Answer
Hi,
Please find the answer as follows:
Flexible Budget - 5000 Hours
Notes:
1) Indirect Material = 3000/3000*5000 = 5000
2) Indirect Labor = 15000/3000*5000 = 25000
3) Factory Supplies = 4500/3000*5000 = 7500
Thanks.
Activity Level Direct labor hours 5000 Variable costs Indirect materials 5000 Indirect labor 25000 Factory supplies 7500 Total variable 37500 Fixed costs Depreciation 20000 Supervision 12000 Property taxes 15000 Total fixed 47000 Total costs 84500Related Questions
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