Overhead Budget

Johnston Company cleans and applies powder coat paint to metal items on a job-order basis. Johnston has budgeted the following amounts for various overhead categories in the coming year.

Supplies	$225,000
Gas	55,000
Indirect labor	170,000
Supervision	75,000
Depreciation on equipment	54,000
Depreciation on the buliding	47,000
Rental of special equipment	10,500
Electricity (for lighting, heating, and air conditioning)	27,400
Telephone	4,700
Landscaping service	1,700
Other overhead	56,000

In the coming year, Johnston expects to powder coat 130,000 units. Each unit takes 1.2 direct labor hours. Johnston has found that supplies and gas (used to run the drying ovensall units pass through the drying ovens after powder coat paint is applied) tend to vary with the number of units produced. All other overhead categories are considered to be fixed.

Required:

1. Calculate the number of direct labor hours Johnston must budget for the coming year. Calculate the variable overhead rate. Calculate the total fixed overhead for the coming year. When required, round your answers to the nearest cent and use the rounded answers in subsequent requirements.

Direct labor hours	fill in the blank b6b7b8011020f8b_1
Variable overhead rate	$fill in the blank b6b7b8011020f8b_2	per direct labor hour
Total fixed overhead	$fill in the blank b6b7b8011020f8b_3

2. Prepare an overhead budget for Johnston for the coming year. Show the total variable overhead, total fixed overhead, and total overhead. When required, round your answers to the nearest cent.

Johnston Company Overhead Budget For the Coming Year

Budgeted direct labor hours	fill in the blank 69287cf4dfe3fc5_1
Variable overhead rate	$fill in the blank 69287cf4dfe3fc5_2
Budgeted variable overhead	$fill in the blank 69287cf4dfe3fc5_3
Budgeted fixed overhead	fill in the blank 69287cf4dfe3fc5_4
Total budgeted overhead	$fill in the blank 69287cf4dfe3fc5_5

Calculate the fixed overhead rate and the total overhead rate. If required, round your answers to the nearest cent.

Fixed overhead rate	$fill in the blank 04642efc4fe1071_1 per direct labor hour
Total overhead rate	$fill in the blank 04642efc4fe1071_2 per direct labor hour

3. What if Johnston had expected to make 128,000 units next year? Assume that the variable overhead per unit does not change and the total fixed overhead amounts do not change. Calculate the new budgeted direct labor hours. fill in the blank 8dc1fefda009fcf_1

Prepare a new overhead budget. If required, round your answers to the nearest cent.

Johnston Company New Overhead Budget For the Coming Year

Budgeted direct labor hours	fill in the blank df5abffed031003_1
Variable overhead rate	$fill in the blank df5abffed031003_2
Budgeted variable overhead	$fill in the blank df5abffed031003_3
Budgeted fixed overhead	fill in the blank df5abffed031003_4
Total budgeted overhead	$fill in the blank df5abffed031003_5

Calculate the fixed overhead rate and the total overhead rate. If required, round your answers to the nearest cent.

Fixed overhead rate	$fill in the blank e7d2e1f5801d004_1 per direct labor hour
Total overhead rate	$fill in the blank e7d2e1f5801d004_2 per direct labor hour