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Flexible Budget In an attempt to improve budgeting, the controller for Engersol, Inc., has developed a flexible budget for overhead costs. Engersol, Inc., makes two

Flexible Budget
In an attempt to improve budgeting, the controller for Engersol, Inc., has developed a flexible budget for overhead costs. Engersol, Inc., makes two types of products, commercial floor cleaners and household floor cleaners. The company expects to produce 300,000 units of the commercial cleaner and 120,000 units of the household cleaner during the coming year. The commercial cleaner requires 0.04 direct labor hour per unit, and the household cleaner requires 0.06. The controller has developed the following cost formulas for each of the four overhead items:
Cost Formula
Maintenance $30,000+ $1.25 DLH
Power $0.50 DLH
Indirect labor $65,000+ $2.30 DLH
Rent $28,000
Required:
Question Content Area
1. Prepare an overhead budget for the expected activity level for the coming year. Round your answers to the nearest cent, if required.
Engersol, Inc.
Overhead Budget
For the Year Ended December 31
Per DLH blank
Budgeted direct labor hours blank fill in the blank e122a9ff4063fb5_1
blank
Variable costs:
Maintenance $fill in the blank e122a9ff4063fb5_2
$fill in the blank e122a9ff4063fb5_3
Power fill in the blank e122a9ff4063fb5_4
fill in the blank e122a9ff4063fb5_5
Indirect labor fill in the blank e122a9ff4063fb5_6
fill in the blank e122a9ff4063fb5_7
Total variable costs $fill in the blank e122a9ff4063fb5_8
Fixed costs:
Maintenance $fill in the blank e122a9ff4063fb5_9
Indirect labor fill in the blank e122a9ff4063fb5_10
Rent fill in the blank e122a9ff4063fb5_11
Total fixed costs fill in the blank e122a9ff4063fb5_12
Total overhead costs $fill in the blank e122a9ff4063fb5_13
Question Content Area
2. Prepare an overhead budget that reflects production that is 10 percent higher than expected (for both products). Round your answers to the nearest cent, if required.
Engersol, Inc.
Overhead Budget
For the Year Ended December 31
Per DLH blank blank
Budgeted direct labor hours blank fill in the blank f00da20bcfb5064_1
blank
Variable costs:
Maintenance $fill in the blank f00da20bcfb5064_2
$fill in the blank f00da20bcfb5064_3
Power fill in the blank f00da20bcfb5064_4
fill in the blank f00da20bcfb5064_5
Indirect labor fill in the blank f00da20bcfb5064_6
fill in the blank f00da20bcfb5064_7
Total variable costs $fill in the blank f00da20bcfb5064_8
Fixed costs:
Maintenance $fill in the blank f00da20bcfb5064_9
Indirect labor fill in the blank f00da20bcfb5064_10
Rent fill in the blank f00da20bcfb5064_11
Total fixed costs fill in the blank f00da20bcfb5064_12
Total overhead costs $fill in the blank f00da20bcfb5064_13
Question Content Area
Prepare an overhead budget for production that is 20 percent lower than expected.
Engersol, Inc.
Overhead Budget
For the Year Ended December 31
Per DLH blank blank
Budgeted direct labor hours blank fill in the blank f39047fb4fc3056_1
blank
Variable costs:
Maintenance $fill in the blank f39047fb4fc3056_2
$fill in the blank f39047fb4fc3056_3
Power fill in the blank f39047fb4fc3056_4
fill in the blank f39047fb4fc3056_5
Indirect labor fill in the blank f39047fb4fc3056_6
fill in the blank f39047fb4fc3056_7
Total variable costs $fill in the blank f39047fb4fc3056_8
Fixed costs:
Maintenance $fill in the blank f39047fb4fc3056_9
Indirect labor fill in the blank f39047fb4fc3056_10
Rent fill in the blank f39047fb4fc3056_11
Total fixed costs fill in the blank f39047fb4fc3056_12
Total overhead costs $fill in the blank f39047fb4fc3056_13
Question Content Area
3. Which of the four data analytic typesdescriptive, diagnostic, predictive, or prescriptiveis being used in creating the three flexible budgets? (See Exhibits 2.5 and 2.6, pp.37,40, for a review of data analytic types.)
The flexible budgets are used
to determine how

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