Reference no: EM132610208

Pollitt Potato Packers has a flexible budget for manufacturing overhead that is based on direct labour hours. The following overhead costs appear on the flexible budget at the 200,000-hour level of activity:

Variable overhead costs (total):

Packing supplies $120,000

Indirect labour $180,000

Fixed overhead costs (total):

Utilities $100,000

Insurance $40,000

Rent $20,000

Problem 1: At an activity level of 180,000 direct labour hours, what amount would the flexible budget estimate for total budgeted fixed costs?

Option A) $150,000.

Option B) $100,000.

Option C) $160,000.

Option D) $144,000.