Blazer Company manufactures machine parts in its Prague plant. Blazer has developed the following flexible budget for overhead for the coming year. Activity level is measured in direct labor hours.

The Prague plant produces two different types of parts. The production budget for November is 50,000 units for Part Q19 and 20,000 units for Part R08. Part Q19 requires 6 minutes of direct labor time, and Part R08 requires 36 minutes. Fixed overhead costs are incurred uniformly throughout the year.

Required:
1. Calculate the number of direct labor hours needed in November to produce Part Q19 and the number of direct labor hours needed in November to produce Part R08. What are the total direct labor hours budgeted for November?
2. Prepare an overhead budget forNovember.

Transcribed Image Text:

Activity Level (hours) Variable Cost Formula 14,000 21,000 28,000 Variable costs: $3.70 2.68 0.06 $6.44 $51,800 77,700 $103,600 56,280 75,040 1,680 90,160 $135,240 $180,320 Maintenance Supplies Power 37,520 840 1,260 Total variable costs Activity Level (hours) Variable Cost Formula 14,000 21,000 28,000 Fixed costs: $ 14,700 14,700 14,700 75,000 $89,700 89,700 $ 89,700 $179,860 $224,940 $270,020 Depreciation Salaries 75,000 75,000 Total fixed costs Total overhead costs