BC Industries has determined that the variable overhead rate is $8.00 per direct labor hour in the Machining Department. The normal production capacity for the Machining Department is 3,000 hours for the month. Fixed costs are budgeted at $9,000 for the month. Prepare a monthly factory overhead flexible budget for 2,000, 3,000, and 4,000 hours of production. Enter all amounts as positive numbers. BC Industries Monthly Factory Overhead Cost Budget-Machining Department Direct labor hours Variable factory overhead cost Fixed factory overhead cost Total factory overhead How much overhead would be applied to production if 4,000 hours were used in the department during the month? If required, round your calculations to two decimal places and your final answer to the nearest dollar. Overhead at 4,000 hours: Would that result in an over or under application of overhead? Enter word "over" or "under" in the box:
BC Industries Monthly Factory Overhead Cost Budget-Machining Department
Direct labor hours | 2,000 | 3,000 | 4,000 |
Variable factory overhead cost | 16,000 | 24,000 | 32,000 |
Fixed factory overhead cost | 9,000 | 9,000 | 9,000 |
Total factory overhead | 25,000 | 33,000 | 41,000 |
overhead to be applied to production if 4,000 hours were used in the department during the month = $41,000
It would result into under application of overhead.
Kindly comment if you need further assistance. Thanks
BC Industries has determined that the variable overhead rate is $8.00 per direct labor hour in...
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