The direct labor budget of Yuvwell Corporation for the upcoming fiscal year cont
ID: 2347704 • Letter: T
Question
The direct labor budget of Yuvwell Corporation for the upcoming fiscal year contains the following details concerning budgeted direct labor hours: budgeted direct labor hours 1st quarter 8,000, 2nd quarter 8,200, 3rd quarter 8,500, 4th quarter 7,800. The company's variable manufacturing overhead rate is $3.25 per direct labor hour and the company's fixed manufacturing overhead is $48,000 per quarter. The only noncash item included in fixed manufacturing overhead is depriciation, which is $16,000 per quarter. Construct the company's manufacturing overhead budget for the upcoming year fiscal year. Compute the company's manufacturing overhead rate (including both variable and fixed manufacturing overhead) for the upcoming fiscal year. Round off to the nearest whole cent.Explanation / Answer
1) 8,000 + 8,200 + 8,500 + 7,800 = 32,500 total direct labor hours 105,625 Variable overhead (32,500 x 3.25) 192,000 Fixed overhead (48,000 x 4) - 64,000 depreciation (16,000 x 4) = $233,625 Cash disbursements for manufacturing overhead for the year. 2) (105,625 variable + 192,000 fixed) / 32,500 hours = $9.15 per hour