Prepare a monthly manufacturing overhead flexible budget

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Reference no: EM13580024

Cook Company estimates that 344,900direct labor hours will be worked during the coming year, 2014, in the Packaging Department. On this basis, the budgeted manufacturing overhead cost data are computed for the year.

Fixed Overhead Costs		Variable Overhead Costs
Supervision	$89,6400	Indirect labor	$144,858
Depreciation	69,960	Indirect materials	86,225
Insurance	31,920	Repairs	44,837
Rent	24,600	Utilities	75,878
Property taxes	22,680	Lubricants	31,041
	$235,800		$382,839

It is estimated that direct labor hours worked each month will range from 21,400to 33,100 hours.

During October, 21,400direct labor hours were worked and the following overhead costs were incurred.

Fixed overhead costs: Supervision $7,470, Depreciation $5,580, Insurance $2,608 Rent $2,050, and Property taxes $1,890.

Variable overhead costs: Indirect labor $10,081, Indirect materials, $4,878, Repairs $2,726, Utilities $4,978, and Lubricants $2,203.

(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, 2014. (List variable costs before fixed costs.)

Reference no: EM13580024

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