Question

Flexible Overhead Budget Leno Manufacturing Company prepared the following factory overhead cost budget for the Press Department for October of the current year, during which it expected to require 18,000 hours of productive capacity in the department: $162,000 5,400 55,800 $223,200 Variable overhead cost: Indirect factory labor Power and light Indirect materials Total variable overhead cost Fixed overhead cost: Supervisory salaries Depreciation of plant and equipment Insurance and property taxes Total fixed overhead cost Total factory overhead cost $78,120 49,100 31,250 158,470 $381,670

Answer 1

Factory overhead cost budget-Press department

For the month ended November 30

Direct labor hours	16000	18000	20000
Variable overhead costs
Indirect factory labor	144000	162000	180000
Power and light	4800	5400	6000
Indirect material	49600	55800	62000
Total variable factory overhead	198400	223200	248000
Fixed factory overhead cost
Supervisory salaries	78120	78120	78120
Depreciation of plant and equipment	49100	49100	49100
Insurance and property taxes	31250	31250	31250
Total fixed factory overhead	158470	158470	158470
Total factory overhead cost	356870	381670	406470