The manufacturing overhead budget at Mahapatra Corporation is based on budgeted

Question

The manufacturing overhead budget at Mahapatra Corporation is based on budgeted direct labor-hours. The direct labor budget indicates that 7,000 direct labor-hours will be required in May. The variable overhead rate is $8.80 per direct labor-hour. The company's budgeted fixed manufacturing overhead is $102,900 per month, which includes depreciation of $18,050. All other fixed manufacturing overhead costs represent current cash flows.

The May cash disbursements for manufacturing overhead on the manufacturing overhead budget should be:

The manufacturing overhead budget at Mahapatra Corporation is based on budgeted direct labor-hours. The direct labor budget indicates that 7,000 direct labor-hours will be required in May. The variable overhead rate is $8.80 per direct labor-hour. The company's budgeted fixed manufacturing overhead is $102,900 per month, which includes depreciation of $18,050. All other fixed manufacturing overhead costs represent current cash flows.

Explanation / Answer

manufacturing overhead= 7,000 direct labor-hours*$8.80 per direct labor-hour+fixed manufacturing overhead is $102,900 per month-depreciation of $18,050=$146,450.

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