Barasti Sand Products Company prepared the following factory o/hcost budget for
ID: 2433896 • Letter: B
Question
Barasti Sand Products Company prepared the following factory o/hcost budget for the Press Dept. for February 2008, during which itexpected to require 10,000 hours of productive capacity in thedept:Variable O/H Cost:
Indirect FactoryLabor $28,000
Power &Light 4,500
IndirectMaterials 22,000
Total VariableCost $54,500
Fixed O/H Cost:
SupervisorySalaries $36,000
Depreciation of Plant &Equip. 30,000
Insurance & PropertyTaxes 8,000
Total FixedCost 74,000
Total Factory O/HCost $128,500
Assuming that the estimated costs for March are the same as forFebruary, prepare a flexible factory o/h cost budget fro the PressDept. for March for 8,000, 10,000, and 12,000 hrs of productions.?
*The txtbook have stated a partial answer....
Total Factory O/H, 12,000 hrs: $139,400
Explanation / Answer
8000 hours
10,000 hours
12,000 hours
28,000 x 12/10, 28,000 x 8/10
$22,400
$28,000
$33,600
4,500 x 12/10, 4,500 x 8/10
$3,600
$4,500
$5,400
17,600 x 12/10, 17,600 x 8/10
$17,600
$22,000
$26,400
$43,600
$54,500
$65,400
Fixed Cost No Change
$36,000
$36,000
$36,000
$30,000
$30,000
$30,000
$8,000
$8,000
$8,000
$74,000
$74,000
$74,000
$117,600
$128,500
$139,400
8000 hours
10,000 hours
12,000 hours
Variable O/H Cost Indirect factory labor28,000 x 12/10, 28,000 x 8/10
$22,400
$28,000
$33,600
Power & Light4,500 x 12/10, 4,500 x 8/10
$3,600
$4,500
$5,400
Indirect Materials17,600 x 12/10, 17,600 x 8/10
$17,600
$22,000
$26,400
Total Variable Cost$43,600
$54,500
$65,400
Fixed O/H Cost SupervisorySalariesFixed Cost No Change
$36,000
$36,000
$36,000
Depreciation of Plant & Equip.$30,000
$30,000
$30,000
Insurance & PropertyTaxes$8,000
$8,000
$8,000
Total Factory O/HCost$74,000
$74,000
$74,000
TotalFactory O/H Cost$117,600
$128,500
$139,400
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