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The direct labor budget of Yuvwell Corporation for the upcoming fiscal year contains the following details concerning budgeted direct labor-hours:
1st Quarter 2nd Quarter 3rd Quarter 4th Quarter
Budgeted direct labor-hours. 8,000 8,200 8,500 7,800
The company uses direct labor-hours as its overhead allocation base. The variable portion of its predetermined manufacturing overhead rate is $3.25 per direct labor-hour and its total fixed manufacturing overhead is $48,000 per quarter. The only noncash item included in fixed manufacturing overhead is depreciation, which is $16,000 per quarter.
Required:
Question 1. Prepare the company's manufacturing overhead budget for the upcoming fiscal year.
Question 2. Compute the company's predetermined overhead rate (including both variable and fixed manufacturing overhead) for the upcoming fiscal year.
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