Question

The master budget of Sunland Company shows that the planned activity level for next year is expected to be 50000 machine hours. At this level of activity, the following manufacturing overhead costs are expected: Indirect labor $760000 Machine supplies 210000 Indirect materials 210000 Depreciation on factory building 150000 Total manufacturing overhead $1330000 A flexible budget for a level of activity of 60000 machine hours would show total manufacturing overhead costs of

Answer 1

A flexible budget for a level of activity of 60000 machine hours would show total manufacturing overhead costs of

Machine hour	60000
Variable manufacturing overhead
Indirect labour	912000
Machine supplies	252000
Indirect materials	252000
Total variable manufacturing overhead	1416000
Fixed manufacturing overhead
Depreciation on factory building	150000
Total fixed manufacturing overhead	150000
Total manufacturing overhead cost	1566000