Exercise 8-5 Manufacturing Overhead Budget [LO8-6] The direct labor budget of Yu

Question

Exercise 8-5 Manufacturing Overhead Budget [LO8-6]

The direct labor budget of Yuvwell Corporation for the upcoming fiscal year contains the following details concerning budgeted direct labor-hours:

The company’s variable manufacturing overhead rate is $7.00 per direct labor-hour and the company’s fixed manufacturing overhead is $88,000 per quarter. The only noncash item included in fixed manufacturing overhead is depreciation, which is $22,000 per quarter.

Complete the company’s manufacturing overhead budget for the upcoming fiscal year.

Compute the company's manufacturing overhead rate (including both variable and fixed manufacturing overhead) for the upcoming fiscal year.

`total budgeted manufacturing overhead for the year

-Budgeted direct labor-hours for the year

-Predetermined overhead rate for the year

The direct labor budget of Yuvwell Corporation for the upcoming fiscal year contains the following details concerning budgeted direct labor-hours:

Explanation / Answer

Yuvwell Corporation Manufacturing Overhead Budget 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter Year Variable manufacturing overhead 84000 71400 73500 79100 308000 Fixed manufacturing overhead 88000 88000 88000 88000 352000 Total manufacturing overhead 172000 159400 161500 167100 660000 Less depreciation 22000 22000 22000 22000 88000 Cash disbursements for manufacturing overhead 150000 137400 139500 145100 572000 total budgeted manufacturing overhead for the year 660000 Budgeted direct labor-hours for the year12000+10200+10500+11300 44000 Predetermined overhead rate for the year (660000/44000) 15

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