Flexible Budget for various levels of Activity Palladium Inc. produces a variety of household cleaning products. Palladium's controller has developed standard costs for the following four overhead items: Variable Rate per Direct Overhead Item Total Fixed Cost Labor Hour Maintenance $ 86,000 $0.20 Power 0.45 Indirect labor 140,000 2.10 Rent 35,000 Next year, Palladium expects production to require 90,000 direct labor hours. Required: 1. Prepare an overhead budget for the expected level of direct labor hours for the coming year. Palladium in Overhead Budget For the Coming Year Variable costs: Rate per Hour Activity Level 90,000 Hours Maintenance Power Indirect labor Total variable cost Fixed costs: Maintenance Indirect labor Rent Total fixed costs Total overhead costs 2. Prepare an overhead budget that reflects production that is 15% higher than expected and for production that is 15% lower than expected, Activity Level Rate per Hour Hours Hours Variable costs: Maintenance Power Indirect labor Total variable costs Fixed costs: Maintenance Indirect labor Rent Total fixed costs Total overhead costs