Question

Exercise 10-3 (Video) Myers Company uses a flexible budget for manufacturing overhead based on direct labor hours. Variable manufacturing overhead costs per direct labor hour are as follows: $1.00 Indirect labor Indirect materials Utilities 0.50 0.20 Fixed overhead costs per month are Supervision $3,500, Depreciation $1,000, and Property Taxes $500. The company believes it will normally operate in a range of 5,500-8,500 direct labor hours per month Prepare a monthly manufacturing overhead flexible budget for 2020 for the expected range of activity, using increments of 1,000 direct labor hours. (List variable costs before fixed costs.) MYERS COMPANY Monthly Manufacturing Overhead Flexible Budget For the Year 2020 Activity Level Direct Labor Hours

Answer 1

Monthly Manufacturing Overhead Flexible Budget
For the Year 2020
Activity level
Direct labor hours	5500	6500	7500	8500
Variable costs
Indirect labor	5500	6500	7500	8500
Indirect materials	2750	3250	3750	4250
Utilities	1100	1300	1500	1700
Total variable cost	9350	11050	12750	14450
Fixed costs
Supervision	3500	3500	3500	3500
Depreciation	1000	1000	1000	1000
Property taxes	500	500	500	500
Total fixed costs	5000	5000	5000	5000
Total costs	14350	16050	17750	19450