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

Question

The manufacturing overhead budget at Cardera Corporation is based on budgeted direct labor-hours. The direct labor budget indicates that 8,700 direct labor-hours will be required in January. The variable overhead rate is $9.30 per direct labor-hour. The company's budgeted fixed manufacturing overhead is $106,140 per month, which includes depreciation of $18,230. All other fixed manufacturing overhead costs represent current cash flows.

The January cash disbursements for manufacturing overhead on the manufacturing overhead budget should be:

$80,910

$168,820

$87,910

$187,050

The manufacturing overhead budget at Cardera Corporation is based on budgeted direct labor-hours. The direct labor budget indicates that 8,700 direct labor-hours will be required in January. The variable overhead rate is $9.30 per direct labor-hour. The company's budgeted fixed manufacturing overhead is $106,140 per month, which includes depreciation of $18,230. All other fixed manufacturing overhead costs represent current cash flows.

Explanation / Answer

Cash disbursement = Variable overhead rate * direct labour hours + Fixed overhead - Depreciation

= $9.30 * 8,700 + $106,140 - $18,230

= $168,820

Related Questions

Navigate

• Browse (All)
• Browse T
• Subjects

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