Question
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.
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 | $ 1.00 | |
Indirect materials | 0.70 | |
Utilities | 0.40 |
Fixed overhead costs per month are Supervision $ 4,200, Depreciation $ 1,800, and Property Taxes $ 600. The company believes it will normally operate in a range of 7,000 13,000 direct labor hours per month. Assume that in July 2017, Myers Company incurs the following manufacturing overhead costs.
Variable Costs | Fixed Costs | |||||
---|---|---|---|---|---|---|
Indirect labor | $ 10,760 | Supervision | $ 4,200 | |||
Indirect materials | 7,520 | Depreciation | 1,800 | |||
Utilities | 3,950 | Property taxes | 600 |
(a) Prepare a flexible budget performance report, assuming that the company worked 11,000 direct labor hours during the month. (List variable costs before fixed costs.)
MYERS COMPANY Manufacturing Overhead Flexible Budget Report For the Month Ended July 31, 2017 | |||||||
---|---|---|---|---|---|---|---|
Difference | |||||||
Budget | Actual Costs | Favorable Unfavorable Neither Favorable nor Unfavorable | |||||
select an opening Budget itemselect an opening Budget item DepreciationDirect Labor HoursFixed CostsIndirect LaborIndirect MaterialsProperty TaxesSupervisionTotal CostsTotal Fixed CostsTotal Variable CostsUtilitiesVariable Costs | Enter a number of hours | Enter a number of hours | |||||
select an opening name for section oneselect an opening name for section one DepreciationDirect Labor HoursFixed CostsIndirect LaborIndirect MaterialsProperty TaxesSupervisionTotal CostsTotal Fixed CostsTotal Variable CostsUtilitiesVariable Costs | |||||||
select a Budget itemselect a Budget item DepreciationDirect Labor HoursFixed CostsIndirect LaborIndirect MaterialsProperty TaxesSupervisionTotal CostsTotal Fixed CostsTotal Variable CostsUtilitiesVariable Costs | $ enter a dollar amount | $ enter a dollar amount | $ enter a difference amount for this row | select an optionselect an option Favorable Unfavorable Neither Favorable nor Unfavorable | |||
select a Budget itemselect a Budget item DepreciationDirect Labor HoursFixed CostsIndirect LaborIndirect MaterialsProperty TaxesSupervisionTotal CostsTotal Fixed CostsTotal Variable CostsUtilitiesVariable Costs | enter a dollar amount | enter a dollar amount | enter a difference amount for this row | select an optionselect an option Favorable Unfavorable Neither Favorable nor Unfavorable | |||
select a Budget itemselect a Budget item DepreciationDirect Labor HoursFixed CostsIndirect LaborIndirect MaterialsProperty TaxesSupervisionTotal CostsTotal Fixed CostsTotal Variable CostsUtilitiesVariable Costs | enter a dollar amount | enter a dollar amount | enter a difference amount for this row | select an optionselect an option Favorable Unfavorable Neither Favorable nor Unfavorable | |||
select a closing name for section oneselect a closing name for section one DepreciationDirect Labor HoursFixed CostsIndirect LaborIndirect MaterialsProperty TaxesSupervisionTotal CostsTotal Fixed CostsTotal Variable CostsUtilitiesVariable Costs | enter a total amount for section one | enter a total amount for section one | enter a difference amount for this row | select an optionselect an option Favorable Unfavorable Neither Favorable nor Unfavorable | |||
select an opening name for section twoselect an opening name for section two DepreciationDirect Labor HoursFixed CostsIndirect LaborIndirect MaterialsProperty TaxesSupervisionTotal CostsTotal Fixed CostsTotal Variable CostsUtilitiesVariable Costs | |||||||
select a Budget itemselect a Budget item DepreciationDirect Labor HoursFixed CostsIndirect LaborIndirect MaterialsProperty TaxesSupervisionTotal CostsTotal Fixed CostsTotal Variable CostsUtilitiesVariable Costs | enter a dollar amount | enter a dollar amount | enter a difference amount for this row | select an optionselect an option FavorableUnfavorableNeither Favorable nor Unfavorable | |||
select a Budget itemselect a Budget item DepreciationDirect Labor HoursFixed CostsIndirect LaborIndirect MaterialsProperty TaxesSupervisionTotal CostsTotal Fixed CostsTotal Variable CostsUtilitiesVariable Costs | enter a dollar amount | enter a dollar amount | enter a difference amount for this row | select an optionselect an option FavorableUnfavorableNeither Favorable nor Unfavorable | |||
select a Budget itemselect a Budget item DepreciationDirect Labor HoursFixed CostsIndirect LaborIndirect MaterialsProperty TaxesSupervisionTotal CostsTotal Fixed CostsTotal Variable CostsUtilitiesVariable Costs | enter a dollar amount | enter a dollar amount | enter a difference amount for this row | select an optionselect an option FavorableUnfavorableNeither Favorable nor Unfavorable | |||
select a closing name for section twoselect a closing name for section two DepreciationDirect Labor HoursFixed CostsIndirect LaborIndirect MaterialsProperty TaxesSupervisionTotal CostsTotal Fixed CostsTotal Variable CostsUtilitiesVariable Costs | enter a total amount for section two | enter a total amount for section two | enter a difference amount for this row | select an optionselect an option FavorableUnfavorableNeither Favorable nor Unfavorable | |||
select a closing Budget itemselect a closing Budget item DepreciationDirect Labor HoursFixed CostsIndirect LaborIndirect MaterialsProperty TaxesSupervisionTotal CostsTotal Fixed CostsTotal Variable CostsUtilitiesVariable Costs | $ enter a total amount for the Manufacturing Overhead Flexible Budget | $ enter a total amount for the Manufacturing Overhead Flexible Budget | $ enter a difference amount for this row | select an optionselect an option Favorable Unfavorable Neither Favorable nor Unfavorable |
(b) Prepare a flexible budget performance report, assuming that the company worked 10,300 direct labor hours during the month. (List variable costs before fixed costs.)
MYERS COMPANY Manufacturing Overhead Flexible Budget Report For the Month Ended July 31, 2017 | |||||||
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