The manufacturing overhead budget at Rotring Corporation is based on budgeted direct labor-hours. The direct labor budget indicates that 2,800 direct labor-hours will be required in September. The variable overhead rate is $7.00 per direct labor-hour. The company's budgeted fixed manufacturing overhead is $43,120 per month, which includes depreciation of $3,640. All other fixed manufacturing overhead costs represent current cash flows. The September cash disbursements for manufacturing overhead on the manufacturing overhead budget should be:
Manufacturing Overhead Budget:
September |
|
Budgeted direct labor-hours |
|
Variable manufacturing overhead rate |
|
Variable manufacturing overhead |
|
Fixed manufacturing overhead |
|
Total manufacturing overhead |
|
Depreciation |
|
Cash disbursement for manufacturing overhead |
Answer
Cash disbursements for manufacturing overhead | |
September | |
Budgeted direct labor-hours | 2,800 |
Variable manufacturing overhead rate | $ 7 |
Variable manufacturing overhead | $ 19,600 |
Fixed manufacturing overhead | $ 43,120 |
Total manufacturing overhead | $ 62,720 |
Depreciation | $ 3,640 |
Cash disbursement for manufacturing overhead | $ 59,080 |
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