Sussman Company cleans and applies powder coat paint to metal items on a job-order basis. Sussmann has budgeted the following amounts for various overhead categories in the coming year.

In the coming year, Sussman expects to powder coat 160,000 units. Each unit takes 1.5 direct labor hours. Sussman has found that supplies and gas (used to run the drying ovens—all units pass through the drying ovens after powder coat paint is applied) tend to vary with the number of units produced. All other overhead categories are considered to be fixed.
Required:
1. Calculate the number of direct labor hours Sussman must budget for the coming year. Calculate the variable overhead rate. Calculate the total fixed overhead for the coming year.
2. Prepare an overhead budget for Sussman for the coming year. Show the total variable overhead, total fixed overhead, and total overhead. Calculate the the fixed overhead rate and the total overhead rate (rounded to the nearest cent).
3. What if Sussman had expected to make 150,000 units next year? Assume that the variable overhead per unit does not change and the total fixed overhead amounts do not change. Calculate the new budgeted direct labor hours and prepare a new overhead budget. Calculate the fixed overhead rate and the total overhead rate (rounded to the nearest cent).LO1

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Supplies Gas Indirect labor Supervision $264,000 60,000 180,000 75,000 Depreciation on equipment 60,000 Depreciation on the building 45,000 Rental of special equipment 12,000 Electricity (for lighting, heating, and air conditioning) 32,400 Telephone 4,300 Landscaping service 1,200 Other overhead 50,000