Myers Company uses a flexible budget for manufacturing overhead based on direct labor hours. Variable manufacturing overhead costs per direct labor hour are as follows. Indirect labor Indirect materials Utilities $1.00 0.60 0.40 Fixed averhead costs per month are Supervision $4.000, Depreciation $1,200, and Property Taxes $800. The company believes it will normally operate in a range of 7,000-10,000 direct labor hours per month Assume that in July 2020, Myers Campany incurs the following manufacturing overhead casts. Variable Casts Fixed Costs Indirect labor $8.800 Supervision $4.000 Indirect materials 5.300 Depreciation 1200 Utilities 3.200 Property taxes 800 MYERS COMPANY Manufacturing Overhead Flexible Budget Report For the Month Ended July 31, 2020 Difference Favorable F Budget Actual Costs Unfavorable U Direct labor hours DLH) 9,000 DLH 9,000 DLH Variable costs Indirect labor $9,000 S8,800 $200F Indirect materials 6,300 5,600 500F Utilities 3.600 400F Total variable costs 18,900 17,800 1,100F Fbed costs Supervision 4,000 4,000 Depreciation 1.200 1,200 Property taxes 800 Totalfixed costs 6,000 6,000 Total costs $24,900 $23,800 $1,100F 800 MYERS COMPANY Manufacturing Overhead Flexible Budget Report For the Month Ended July 31, 2020 Difference Favorable F Budget Actual Costs Unfavorable U Direct labor hours DLHI 8,500 DLH 8,500 DLH Variable costs Indirect labor ($1.00) $8.500 $8,800 $300U Indirect materials ($0.70) 5.950 5.800 150F Utilities ($0.40) 3400 3.200 200F Total variable costs ($2.10 17.850 17.900 Fixed costs Supervision 4.000 4,000 Depreciation 1.200 1.200 Property taxes 200 Total fund casts 6,000 6.000 Total costs $23.850 $23.800 $50F SOF 800 Comment on the findings of manufacturing overhead flexible budget report using the two different direct labor hours 9.000 and 8,500. BI UTTLE 513 EES" - MIT Myers Company uses a flexible budget for manufacturing overhead based on direct labor hours. Variable manufacturing overhead costs per direct labor hour are as follows. Indirect labor Indirect materials Utilities $1.00 0.60 0.40 Fixed averhead costs per month are Supervision $4.000, Depreciation $1,200, and Property Taxes $800. The company believes it will normally operate in a range of 7,000-10,000 direct labor hours per month Assume that in July 2020, Myers Campany incurs the following manufacturing overhead casts. Variable Casts Fixed Costs Indirect labor $8.800 Supervision $4.000 Indirect materials 5.300 Depreciation 1200 Utilities 3.200 Property taxes 800 MYERS COMPANY Manufacturing Overhead Flexible Budget Report For the Month Ended July 31, 2020 Difference Favorable F Budget Actual Costs Unfavorable U Direct labor hours DLH) 9,000 DLH 9,000 DLH Variable costs Indirect labor $9,000 S8,800 $200F Indirect materials 6,300 5,600 500F Utilities 3.600 400F Total variable costs 18,900 17,800 1,100F Fbed costs Supervision 4,000 4,000 Depreciation 1.200 1,200 Property taxes 800 Totalfixed costs 6,000 6,000 Total costs $24,900 $23,800 $1,100F 800 MYERS COMPANY Manufacturing Overhead Flexible Budget Report For the Month Ended July 31, 2020 Difference Favorable F Budget Actual Costs Unfavorable U Direct labor hours DLHI 8,500 DLH 8,500 DLH Variable costs Indirect labor ($1.00) $8.500 $8,800 $300U Indirect materials ($0.70) 5.950 5.800 150F Utilities ($0.40) 3400 3.200 200F Total variable costs ($2.10 17.850 17.900 Fixed costs Supervision 4.000 4,000 Depreciation 1.200 1.200 Property taxes 200 Total fund casts 6,000 6.000 Total costs $23.850 $23.800 $50F SOF 800 Comment on the findings of manufacturing overhead flexible budget report using the two different direct labor hours 9.000 and 8,500. BI UTTLE 513 EES" - MIT
