Question

Myers Company uses a flexible budget for manufacturing overhead based on direct labor hours. Variable manufacturing overhead costs per direct labor hour are as follows: Indirect labor $1.10 Indirect materials 0.70 Utilities 0.40 Fixed overhead costs per month are Supervision $3,600, Depreciation $1,800, and Property Taxes $800. The company believes it will normally operate in a range of 7,700–11,000 direct labor hours per month. Prepare a monthly manufacturing overhead flexible budget for 2020 for the expected range of activity, using increments of 1,100 direct labor hours. (List variable costs before fixed costs.) MYERS COMPANY Monthly Manufacturing Overhead Flexible Budget For the Year 2020 $ $ $ $ $ $ $ $ Click if you would like to Show Work for this question: Open Show Work

Answer 1

			Flexible	Budget
direct labor hours			7,700	8,800	9,900	11,000
variable costs
Indirect labor		1.1	8470	9680	10890	12100
indirect materials		0.7	5390	6160	6930	7700
utilities		0.4	3080	3520	3960	4400
total variable costs			16940	19360	21780	24200
fixed cost
supervision			3,600	3,600	3,600	3,600
Depreciation			1,800	1,800	1,800	1,800
property taxes			800	800	800	800
total fixed cost			6,200	6,200	6,200	6,200
total cost			23,140	25,560	27,980	30,400