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Exercise 21-11 Your answer is partially correct. Try again. Atlanta Company is p

ID: 2529623 • Letter: E

Question

Exercise 21-11 Your answer is partially correct. Try again. Atlanta Company is preparing its manufacturing overhead budget for 2017. Relevant data consist of the following Units to be produced (by quarters): 10,400, 12,200, 14,700, 17,000 Direct labor: Time is 1.5 hours per unit. Variable overhead costs per direct labor hour: indirect materials $0.90; indirect labor 1.30; and maintenance 0.70 Fixed overhead costs per quarter: supervisory salaries $37,240; depreciation $18,190; and maintenance $14,310 Prepare the manufacturing overhead budget for the year, showing quarterly data. (Round overhead rate to 2 decimal places, e.g. 1.25. List variable expenses before fixed expense.) ATLANTA COMPANY Manufacturing Overhead Budget For the Year Ending December 31, 2017 Quarter 2 3 4 Year Units to be Produced Desired Ending Materials ndirect Material Undirect Labor otal Variabl ixed Cost pervI Salaries reciation aintenance otal Fixed otal Manufacturing verhead Direct labor hours Manufacturing overhead rate per direct labor hour

Explanation / Answer

Atlanta Company

Manufacturing overhead budget:

Atlanta Company

Manufacturing Overhead Budget

for the year ending December 2017

Quarter

1

2

3

4

Year

Variable costs:

Indirect Materials at $0.90 per hour

$14,040

$16,470

$19,845

$22,950

$73,305

Indirect labor at $1.30

$20,280

$23,790

$28,665

$33,150

$105,885

Maintenance at $0.70

$10,920

$12,810

$15,435

$17,850

$57,015

Total Variable

$45,240

$53,070

$63,945

$73,950

$236,205

Fixed Costs:

Supervisory Salaries

$37,240

$37,240

$37,240

$37,240

$148,960

Depreciation

$18,190

$18,190

$18,190

$18,190

$72,760

Maintenance

$14,310

$14,310

$14,310

$14,310

$57,240

total fixed cost

$69,740

$69,740

$69,740

$69,740

$278,960

Total manufacturing overhead

$114,980

$122,810

$133,685

$143,690

$515,165

Direct labor hours

15,600

18,300

22,050

25,500

81,450

Manufacturing overhead rate per direct labor hour

$6.32

units to be produced

10,400

12,200

14,700

17,000

54,300

Direct labor hours per unit

1.5

1.5

1.5

1.5

1.5

total direct labor hours

15,600

18,300

22,050

25,500

81,450

Atlanta Company

Manufacturing Overhead Budget

for the year ending December 2017

Quarter

1

2

3

4

Year

Variable costs:

Indirect Materials at $0.90 per hour

$14,040

$16,470

$19,845

$22,950

$73,305

Indirect labor at $1.30

$20,280

$23,790

$28,665

$33,150

$105,885

Maintenance at $0.70

$10,920

$12,810

$15,435

$17,850

$57,015

Total Variable

$45,240

$53,070

$63,945

$73,950

$236,205

Fixed Costs:

Supervisory Salaries

$37,240

$37,240

$37,240

$37,240

$148,960

Depreciation

$18,190

$18,190

$18,190

$18,190

$72,760

Maintenance

$14,310

$14,310

$14,310

$14,310

$57,240

total fixed cost

$69,740

$69,740

$69,740

$69,740

$278,960

Total manufacturing overhead

$114,980

$122,810

$133,685

$143,690

$515,165

Direct labor hours

15,600

18,300

22,050

25,500

81,450

Manufacturing overhead rate per direct labor hour

$6.32