The direct labor budget of Yuvwell Corporation for the upcoming fiscal year cont

Question

The direct labor budget of Yuvwell Corporation for the upcoming fiscal year contains the following details concerning budgeted direct labor-hours: 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter Budgeted direct labor-hours 8,400 8,400 8,700 8,100 The company's variable manufacturing overhead rate is $2.50 per direct labor-hour and the company's fixed manufacturing overhead is $52,000 per quarter. The only noncash item included in fixed manufacturing overhead is depreciation, which is $13,000 per quarter

Explanation / Answer

1) Manufacturing overhead budget :

B) Predetermine overhead rate :

1st quarter 2nd quarter 3rd quarter 4th quarter Year Budgeted labour hour 8400 8400 8700 8100 33600 Variable manufacturing overhead per hour 2.50 2.50 2.50 2.50 2.5 Variable manufacturing overhead 21000 21000 21750 20250 84000 Fixed manufacturing overhead 52000 52000 52000 52000 208000 Total manufacturing overhead 73000 73000 73750 72250 292000 Less: Depreciation (13000) (13000) (13000) (13000) (52000) Cash disbursement for manufacturing overhead 60000 60000 60750 59250 240000

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