The direct labour budget of Small Corporation for the upcoming fiscal year conta
ID: 2538843 • Letter: T
Question
The direct labour budget of Small Corporation for the upcoming fiscal year contains the following details concerning budgeted direct labour-hours: First Quarter Second Quarter Third Quarter Fourth Quarter Budgeted direct labour-hours 5,400 5,200 5,600 5,800 The company's variable manufacturing overhead rate is $1.95 per direct labour-hour, and the company's fixed manufacturing overhead is $39,000 per quarter. The only non-cash item included in the fixed manufacturing overhead is depreciation, which is $19,000 per quarter. Required 1. Prepare the company's manufacturing overhead budget for the upcoming fiscal year. SMALL CORPORATION Manufacturing Overhead Budget First Quarter Second QuarterThird Quarter Fourth Quarter Year Variable manufacturing overhead Fixed manufacturing overhead Total manufacturing overhead Less depreciation Cash disbursements for manufacturing overhead 2. Compute the company's manufacturing overhead rate (including both variable and fixed manufacturing overhead) for the upcoming fiscal year. (Round your answer to 2 decimal places.) Predetermined overhead rate for the yearExplanation / Answer
Answer:-1)-
2)-
Predetermined overhead rate for the year:-
Total manufacturing overhead (Variable & Fixed)/Total budgeted direct labor hours
=$198900/22000 direct labor hours =$9.04 per direct labor hours
Small Corporation Manufacturing Overhead budget Particulars First Quarter Second Quarter Third Quarter First Quarter Year Budgeted direct labor hours (a) 5400 5200 5600 5800 22000 Varable manufacturing overhead rate per DLH (b) $1.95 $1.95 $1.95 $1.95 $1.95 Variable manufacturing overhead (c=a*b) 10530 10140 10920 11310 42900 Add:- Fixed manufacturing overhead 39000 39000 39000 39000 156000 Total manufacturing overhead 49530 49140 49920 50310 198900 Less:- Depreciation 19000 19000 19000 19000 76000 Cash disbursements for manufacturing overhead 30530 30140 30920 31310 122900