Question

Flexible Overhead Budget Leno Manufacturing Company prepared the following factory overhead cost budget for the Press Department for October of the current year, during which it expected to require 10,000 hours of productive capacity in the department: Variable overhead cost: Indirect factory labor $84,000 Power and light 3,800 Indirect materials 22,000 Total variable overhead cost $109,800 Fixed overhead cost: Supervisory salaries $38,430 Depreciation of plant and equipment 24,160 Insurance and property taxes 15,370 Total fixed overhead cost 77,960 Total factory overhead cost $187,760 Assuming that the estimated costs for November are the same as for October, prepare a flexible factory overhead cost budget for the Press Department for November for 8,000, 10,000, and 12,000 hours of production. Round your interim computations to the nearest cent, if required. Enter all amounts as positive numbers. Leno Manufacturing Company Factory Overhead Cost Budget-Press Department For the Month Ended November 30 Direct labor hours 8,000 10,000 12,000 Variable overhead cost: Indirect factory labor $ $ $ Power and light Indirect materials Total variable factory overhead $ $ $ Fixed factory overhead cost: Supervisory salaries $ $ $ Depreciation of plant and equipment Insurance and property taxes Total fixed factory overhead $ $ $ Total factory overhead cost $ $ $

Answer 1

Factory Overhead Cost Budget-Press Department
For the Month Ended November 30
Direct labor hours	8000	10000	12000
Variable overhead cost:
Indirect factory labor	67200	84000	100800
Power and light	3040	3800	4560
Indirect materials	17600	22000	26400
Total variable factory overhead	87840	109800	131760
Fixed factory overhead cost:
Supervisory salaries	38430	38430	38430
Depreciation of plant and equipment	24160	24160	24160
Insurance and property taxes	15370	15370	15370
Total fixed factory overhead	77960	77960	77960
Total factory overhead cost	165800	187760	209720
Workings:
Direct labor hours	8000	12000
Variable overhead cost:
Indirect factory labor	=8000*8.4	=12000*8.4
Power and light	=8000*0.38	=12000*0.38
Indirect materials	=8000*2.2	=12000*2.2