The manufacturing overhead budget at Cutchin Corporation is based on budgeted di
ID: 2478800 • Letter: T
Question
The manufacturing overhead budget at Cutchin Corporation is based on budgeted direct labor-hours. The direct labor budget indicates that 3.900 direct labor hours will be required in September. The variable overhead rate Is $7 per direct labor hour The company's budgeted fixed manufacturing overhead is $43.230 per month, which Includes deprecation of $3.530 All other fixed manufacturing overhead costs represent current cash flows The September cash disbursements for manufacturing overhead on the manufacturing overhead budget should be: $70.530 $27.300 $67.000 $39.700Explanation / Answer
Solution-
$67,000
Calculation-
Manufacturing Overhead Budget
September
Budgeted direct labor-hours
3,900
Variable manufacturing overhead rate
$7
Variable manufacturing overhead
$27,300
Fixed manufacturing overhead
$43,230
Total manufacturing overhead
$70,530
Less-depreciation
$3,530
Cash disbursement for manufacturing overhead
$67,000
Manufacturing Overhead Budget
September
Budgeted direct labor-hours
3,900
Variable manufacturing overhead rate
$7
Variable manufacturing overhead
$27,300
Fixed manufacturing overhead
$43,230
Total manufacturing overhead
$70,530
Less-depreciation
$3,530
Cash disbursement for manufacturing overhead
$67,000
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