The Production Department of Hruska Corporation has submitted the following fore
ID: 2543211 • Letter: T
Question
The Production Department of Hruska Corporation has submitted the following forecast of units to be produced by quarter for the upcoming fiscal year:
In addition, the variable manufacturing overhead rate is $1.80 per direct labor-hour. The fixed manufacturing overhead is $81,000 per quarter. The only noncash element of manufacturing overhead is depreciation, which is $21,000 per quarter.
Prepare the company’s direct labor budget for the upcoming fiscal year, assuming that the direct labor workforce is adjusted each quarter to match the number of hours required to produce the forecasted number of units produced. (Round "Direct labor time per unit (hours)" and "Direct labor cost per hour" answers to 2 decimal places.)
The Production Department of Hruska Corporation has submitted the following forecast of units to be produced by quarter for the upcoming fiscal year:
Explanation / Answer
Huska Corporation Direct Labour Budget Quater 1 Quater 2 Quater 3 Quater 4 1 Units to be produce 10,100 9,100 11,100 12,100 2 Direct Labour time per unit ( hours) 0.25 0.25 0.25 0.25 3 Total Direct Labour hours needed (1 X 2) 2,525 2,275 2,775 3,025 4 Direct labour cost per hour $ 13.00 $ 13.00 $ 13.00 $ 13.00 5 Total Direct labour cost (3 X 4) $ 32,825.00 $ 29,575.00 $ 36,075.00 $ 39,325.00 Huska Corporation Manufacturing Overhead Budget Quater 1 Quater 2 Quater 3 Quater 4 1 Budget Direct labour hours 2,525 2,275 2,775 3,025 2 Variable overhead rate $ 1.80 $ 1.80 $ 1.80 $ 1.80 3 Variable Manufacturing Overhead (1X2) $ 4,545.00 $ 4,095.00 $ 4,995.00 $ 5,445.00 4 Add : Fixed Manufacturing Overhead $ 81,000.00 $ 81,000.00 $ 81,000.00 $ 81,000.00 5 Total Manufacturing Overhead $ 85,545.00 $ 85,095.00 $ 85,995.00 $ 86,445.00 6 Less : Depreciation $ 21,000.00 $ 21,000.00 $ 21,000.00 $ 21,000.00 7 Cash Disbursements for manufacturing Overheads $ 64,545.00 $ 64,095.00 $ 64,995.00 $ 65,445.00
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