Asked by Sareeka Ramlal on Jun 12, 2024
Verified
The Charade Corporation is preparing its Manufacturing Overhead budget for the fourth quarter of the year. The budgeted variable manufacturing overhead is $5.00 per direct labor-hour; the budgeted fixed manufacturing overhead is $75,000 per month, of which $15,000 is factory depreciation.If the budgeted direct labor time for November is 7,000 hours, then the total budgeted manufacturing overhead for November is:
A) $95,000
B) $110,000
C) $75,000
D) $125,000
Manufacturing Overhead Budget
A plan that outlines the expected manufacturing overhead costs for a period, helping businesses control and allocate expenses effectively.
Direct Labor-Hour
A measure of the labor time directly involved in producing goods, often used to allocate labor costs to products.
Variable Manufacturing Overhead
Costs in manufacturing that vary with the level of production output, such as utilities and indirect materials.
- Organize and appraise a manufacturing overhead budget, knowing the fixed and variable elements it comprises.
Verified Answer
$75,000 - $15,000 = $60,000
Next, multiply the budgeted variable manufacturing overhead rate by the budgeted direct labor hours:
$5.00 x 7,000 = $35,000
Finally, add the total budgeted fixed manufacturing overhead to the total budgeted variable manufacturing overhead:
$60,000 + $35,000 = $95,000
Therefore, the total budgeted manufacturing overhead for November is $95,000, which is answer choice B.
Learning Objectives
- Organize and appraise a manufacturing overhead budget, knowing the fixed and variable elements it comprises.
Related questions
Davis Corporation Is Preparing Its Manufacturing Overhead Budget for the ...
The Manufacturing Overhead Budget at Polich Corporation Is Based on ...
The Manufacturing Overhead Budget of Reigle Corporation Is Based on ...
The Manufacturing Overhead Budget at Foshay Corporation Is Based on ...
Arciba Inc ...