Prepare the company manufacturing overhead budget

Assignment Help Accounting Basics

Reference no: EM132721836

Problem - The production department of Raredon Corporation has submitted the following forecast of units to be produced by quarter for the upcoming ?scal year:

	1st Quarter	2nd Quarter	3rd Quarter	4th Quarter
Units to be produced	23,000	29,000	26,000	23,000

Each unit requires 1.2 direct labour-hours, and direct labour-hour workers are paid $22 per hour.

In addition, the variable manufacturing overhead rate is $1.40 per direct labour-hour. The ?xed manufacturing overhead is $170,000 per quarter. The only noncash element of manufacturing overhead is depreciation, which is $54,000 per quarter.

Required -

1. Prepare the company's direct labour budget for the upcoming ?scal year, assuming that the direct labour workforce is adjusted each quarter to match the number of hours required to produce the forecasted number of units produced.

2. Prepare the company's manufacturing overhead budget.

Reference no: EM132721836

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