Question

Bennett Company expects to produce 2.030 units in January that will require 8,120 hours of direct labor and 2,210 units in February that will require 8,840 hours of direct labor. Bennett budgets $10 per unit for variable manufacturing overhead: $2,100 per month for depreciation; and $78,460 per month for other fixed manufacturing overhead costs. Prepare Bennett's manufacturing overhead budget for January and February, including the predetermined overhead allocation rate using direct labor hours as the allocation base. (Abbreviations used: VOH = variable manufacturing overhead; FOH = fixed manufacturing overhead.) Bennett Company Manufacturing Overhead Budget Two Month Ended January 31 and February 28 January February Total VOH cost per unit Budgeted VOH Budgeted FOH Depreciation Other FOH costs Total budgeted FOH Budgeted manufacturing overhead costs

Answer 1

Manufacturing overhead budget

	January	February	Total
Production units	2030	2210	4240
VOH cost per unit	10	10	10
Budgeted VOH	20300	22100	42400
Budgeted FOH
Depreciation	2100	2100	4200
Other FOH costs	78460	78460	156920
Total budgeted FOH	80560	80560	161120
Budgeted manufacturing overhead costs	100860	102660	203520
Direct labor hour	8120	8840	16960
Budgeted manufacturing overhead cost			203520
Predetermine overhead allocation rate			12