Problem 24-1A Bumblebee Company estimates that 315,600 direct labor hours will b

Question

Problem 24-1A Bumblebee Company estimates that 315,600 direct labor hours will be workced during the coming year, 2017, in the Fackag ng Department. On this basis, the budgeted manufacturing overhead cost data are computed for the year Supervision Depreciation Insurance Rent Property taxes $38,800 Indirect labor 70,080 Indirect maternials 29,040 Repairs 25,440 Utilities 21,840 Lubricants $145,176 69,432 31,560 63,120 15,780 $325,068 It is estimated that direct labor hours worked each month will range from 25,700 to 32,000 hours During October, 25,700 direct labor hours were worked and the following overhead costs were incurred. Fixed overhead costs: Supervision S7,400, Depreciation $5,840, Insurance S2,380, Rent S2, 120, and Property taxes $1,820. Variable overhead costs: Indirect labor $12,792, Ind rect materials, S5,234, Repairs $2,520, Utilities $5 450, and Lubricants s1,575 (a) Prepare a monthly manufacturing overhead flexible budget for each increment of 2,100 direct labor hours aver the relevant range for the year ending December 31, 2017. (List varlable costs before fixed costs.) Monthly Overhead Flexible Budget For the Year 2017 (b) Prepare a flexible budget report for October. (List variable costs before fixed costs) Manufacturing Overhead Flexible Budget Report For the Month Fnded October 31, 2017 Favorable Neither Favorable

Explanation / Answer

1) activity level Direct labor hours 25,700 27,800 29,900 32,000 variable costs Indirect labor 0.46 11822 12788 13754 14720 indirect materials 0.22 5654 6116 6578 7040 repairs 0.1 2570 2780 2990 3200 utilities 0.2 5140 5560 5980 6400 lubricants 0.05 1285 1390 1495 1600 tota variable cost 1.03 26471 28634 30797 32960 Fixed expenses Supervision 7400 7400 7400 7400 Depreciation 5840 5840 5840 5840 insurance 2420 2420 2420 2420 Rent 2120 2120 2120 2120 property taxes 1820 1820 1820 1820 total fixed expenses 19600 19600 19600 19600 total cost 46071 48234 50397 52560 2) budget Actual difference activity level Direct labor hours 25,700 25,700 variable costs Indirect labor 0.46 11,822 12,792 970 U indirect materials 0.22 5654 5,234 420 F repairs 0.1 2570 2,520 50 F utilities 0.2 5140 5,450 310 U lubricants 0.05 1285 1,575 290 U tota variable cost 1.03 26471 27571 1100 U Fixed expenses Supervision 7400 7,400 0 N Depreciation 5840 5,840 0 N insurance 2420 2,380 40 F Rent property taxes 2120 2,120 0 N property taxes 1820 1,820 0 N total fixed expenses 19600 19,560 40 F total cost 46071 47131 1060 U

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