60.1K

Verified Solution

Link Copied!

COULD YOU PLEASE DEMONSTRATE THE FORMULAS YOU USE TO GET THE ANSWERS? THANK YOU

P22-IA Prepare flexible manufacturing overhead budget Bumblebee Company estimates that 300,000 direct labor hours will be worked during the coming year, 2017, in the Packaging Department. On this basis, the budgeted manufacturing overhead cost data, shown below, are computed for the year Fixed Overhead Costs Variable Overhead Costs Supervision Depreciation Insurancoe Rent Property taxes $96,000 72,000 30,000 24,000 18,000 $240,000 Indirect labor Indirect materials Repairs Utilities Lubricants $126,000 90,000 69,000 72,000 18,000 S375,000 It is estimated that direct labor hours worked each month will range from 27,000 to 36,000 hours. During October 27,000 direct labor hours were worked and the following overhead costs were incurred Fixed overhead costs: supervision $8,000, depreciation S6,000, insurance $2,460, rent $2,000 and property taxes S1,500 Variable overhead costs: indirect labor $12,432, indirect materials $7,680, repairs $6,100, utilities $6,840, and lubricants $1,920 Instructions (a) Prepare a monthly manufacturing overhead flexible budget for each increment of 3,000 direct labor hours over the relevant range for the year ending December 31,2017. (b) Prepare a flexible budget report for October (c ) Comment on management's efficiency in controlling manufacturing overhead costs in October

Answer & Explanation Solved by verified expert

See Answer