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Manufacturing Overhead Budget
At Royal, manufacturing overhead is applied to units of product on the basis of direct labor hours.
The variable manufacturing overhead rate is $20 per direct labor hour.
Fixed manufacturing overhead is $50,000 per month, which includes $20,000 of noncash costs (primarily depreciation of plant assets).
prepare the manufacturing overhead budget.
| | | Month | | | |
| | April | May | June | Quarter 2 | |
| Budgeted direct labor hours | | | | | |
| Variable manufacuring overhead rate | | | | | |
| Variable manufacturing overhead | | | | | |
| Fixed manufacturing overhead | | | | | |
| Total manufacturing overhead cost | | | | | |
| Less: noncash costs (depreciation) | | | | | |
| Cash disbursements for manufacturing overhead | | | | | |
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