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Question - Jenner Company developed its annual manufacturing overhead budget for its master budget 2008 as follows
Expected annual operating capacity 120,000 direct labor hours,
Variable overhead costs
Indirect labor 420,000
Indirect materials 90,000
factory supplies 30,000
Total variables 540,000
Fixed overhead costs
Depreciation 180,000
Supervision 120,000
Property taxes 96,000
Total fixed 396,000
Total Costs $936,000
The relevant for monthly activity is expected to be between 8,000 and 12,000 direct labor hours.
What would the flexible budget for the monthly activity level of 8,000 and 9,000 direct labor hours look like?
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