Flexible Overhead Budget

Wiki Wiki Company has determined that the variable overhead rate is $2.9 per direct labor hour in the Fabrication Department. The normal production capacity for the Fabrication Department is 16,000 hours for the month. Fixed costs are budgeted at $68,800 for the month.

a. Prepare a monthly factory overhead flexible budget for 14,800, 16,000, and 17,200 hours of production. Enter all amounts as positive numbers.

Wiki Wiki Company
Monthly Factory Overhead Cost Budget-Fabrication Department
Direct labor hours	14,800	16,000	17,200
Variable factory overhead cost	$	$	$
Fixed factory overhead cost
Total factory overhead cost	$	$	$

Feedback

Calculate the variable costs at each level of direct labor hours; remember to include fixed costs.

Learning Objective 4.

b. How much overhead would be applied to production if 17,200 hours were used in the department during the month? If required, round your calculations to two decimal places and your final answer to the nearest dollar. $