Question

dential mechines, ranging Johnny Lee Inc produces a line of small gasoline-powered engines thet can be used in a variety of res consists of three different models, each meant to fil the needs of a different market. Assume you are the cost accountant for this company and that you have been asked by the owner of the company to construct a flexible budget for factory overhead costs which seem to be growing faster than revenues. Currently, the company uses machine hours (MHs) as the basis for assigning both variable and fixed factory overhead costs to products Within the relevant range of output, you determine that the following factory fixed overhead costs per month should occur engineering support, $16,700, insurance on the manufacturing facility, $6,700 property taxes on the manufacturing facility, $13,700 depreciation on manufacturing equipment, $15,500; and indirect labor costs of supervisory salaries, $16,500, setup labor, $4,100, and materials handling, $4,200. Variable factory overhead costs are budgeted at $106.00 per machine hour, as follows: electricity. $25.00, indirect materiels for Mateial A of $18.00 and for Material B of $2100; indirect labor-maintenance, $2300, and production-related supplies, $19.00 Required 1. Prepare a fexible budget for Johnny Lee for each of the following monthly levels of machine hours: (a) 5,700, (b) 6,700, and (c) 7700 2 Generate an equation to represent, within the relevant range, the factory overhead costs per month for Johnny Lee. Use this equation to estimate monthly total overhead cost for machine hours of 4,700 to 7700, in increments of 500. Complete this question by entering your answers in the tabs below equired 1 Required 2 Precare a fexible budget for Johnny Lee for each of the folowing monthly levels of machine hours: (a) 5,700, (b) 6,700, and (c) 7,700. Total varatie overhead C Prev S of 5 E Next MacBook Ai «Н F2 Apple fledownload...Earnings.pdf DisneyESPN Yahool Global research Gmail Mai iz #20 5 Complete this question by entering your answers in the tabs below. Required 2 Required 1 Prepare a flexible budget for Johnny Lee for each of the following monthly levels of machine hours: (a) 5,700, (b) 6,700, and (c) 7,700. Budgeted fixed overhead Total fxed overhead

Answer 1

Solution :-

Flexible budget for johnny Lee.Inc
MACHINE HOURS	1	5700	6700	7700
Variable overhead costs
Electricity	$ 25	$    142,500	$    167,500	$ 192,500
Materials
Material A	$ 18	$ 102,600	$    120,600	$    138,600
Material B	$ 21	$    119,700	$    140,700	$    161,700
Maintainence labour	$23	$    131,100	$    154,100	$    177,100
Manufacturing supplies	$ 19	$    108,300	$    127,300	$    146,300
Total Variable costs (A)		$    604,200	$ 710,200	$ 816,200
Fixed Overhead costs
Engineering support		$ 16,700.00	$ 16,700.00	$ 16,700.00
Insurance on manufacturing facility		$    6,700.00	$    6,700.00	$    6,700.00
property taxes		$ 13,700.00	$ 13,700.00	$ 13,700.00
Depreciation on Manufacturing facility		$ 15,500.00	$ 15,500.00	$ 15,500.00
Material Handling		$    4,200.00	$    4,200.00	$    4,200.00
salaries		$ 16,500.00	$ 16,500.00	$ 16,500.00
Setup labour		$    4,100.00	$    4,100.00	$    4,100.00
Total Fixed Costs (B)		$ 77,400.00	$ 77,400.00	$ 77,400.00
Total costs (A+B)		$ 681,600	$ 787,600	$ 893,600