Dinklemyer Corporation uses direct labor hours as its single cost driver. Actual overhead costs and actual direct labor hours for the first live months of the current year are as follows:
Month | Actual Total Overhead | Actual Direct Labor Hours |
January | $980,000 | 19,200 |
February | 950,000 | 18,400 |
March | 860,000 | 17,000 |
April | 752,500 | 12,700 |
May | 760,000 | 13,200 |
a. Compute the company’s estimated variable manufacturing overhead cost per direct labor hour.
b. Estimate the company’s total monthly fixed manufacturing overhead cost.
c. Estimate the company’s total manufacturing overhead for June through August if 50,000 total direct labor hours are budgeted for that specific three-month period.
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