6.(6 points)

The following budget information relates to General Motors Company.

Variable manufacturing overhead costs per machine hour are as follows

Expected annual operating capacity 120,000 Direct Labor Hours

Variable overhead costs

Indirect labor $310,000

Indirect materials 100,000

Factory supplies 34,000

Total variable 444,000

Fixed overhead costs

Depreciation 170,000

Supervision 120,000

Property taxes 96,000

Total fixed 386,000

Total costs $830,000

The relevant range for monthly activity is expected to be between 9,000 and 11,000 direct labor hours.

Instructions

General Motors would like a flexible manufacturing overhead budget

prepared based on machine hours. Given the range of activity above,

Prepare the budget using increments of 1,000 machine hours.

General Motors Company
Monthly Flexible Manufacturing Overhead Budget
Activity level				9,000	10,000	11,000