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 16,000 hours of productive capacity in the department:

Variable overhead costs:
Indirect factory labor	$137,600
Power and light	5,600
Indirect materials	35,200
Total variable overhead cost		$178,400
Fixed overhead costs:
Supervisory salaries	$62,440
Depreciation of plant and equipment	39,250
Insurance and property taxes	24,980
Total fixed overhead cost		126,670
Total factory overhead cost		$305,070

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 14,000, 16,000, and 18,000 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	14,000	16,000	18,000
Variable overhead costs:
Indirect factory labor	$	$	$
Power and light
Indirect materials
Total variable factory overhead	$	$	$
Fixed factory overhead costs:
Supervisory salaries	$	$	$
Depreciation of plant and equipment
Insurance and property taxes
Total fixed factory overhead	$	$	$
Total factory overhead	$	$	$

Answer 1

Factory overhead cost budget :

Direct labour hours	14000	16000	18000
Variable overhead costs:
Indirect factory labor	120400	137600	154800
Power and light	4900	5600	6300
Indirect materials	30800	35200	39600
Total variable factory overhead	156100	178400	200700
Fixed factory overhead costs:
Supervisory salaries	62440	62440	62440
Depreciation of plant and equipment	39250	39250	39250
Insurance and property taxes	24980	24980	24980
Total fixed factory overhead	126670	126670	126670
Total factory overhead	282770	305070	327370