Overhead	Total Fixed Cost	Variable Rate per
Item		Direct Labor Hour
Maintenance	$86,000	$0.20
Power		0.45
Indirect labor	140,000	2.10
Rent	35,000

Next year, Palladium expects production to require 90,000 direct labor hours.

	Required:
1.	Prepare an overhead budget for the expected level of direct labor hours for the coming year.
2.	Prepare an overhead budget that reflects production that is 15% higher than expected, and for production that is 15% lower than expected.

1. Prepare an overhead budget for the expected level of direct labor hours for the coming year. (Note: Refer to the Amount Descriptions list provided for the exact wording of the answer choices for text entries.)

Palladium Inc.

Overhead Budget

For the Coming Year

1		formula	activity level: 90,000 hours
2	varibale cost:
3
4
5
6
7	fixed costs:
8
9
10
11
12

2. Prepare an overhead budget that reflects production that is 15% higher than expected, and for production that is 15% lower than expected. (Note: Refer to the Amount Descriptions list provided for the exact wording of the answer choices for text entries.)

Palladium Inc.

Overhead Budget

For the Coming Year

1		formula	activity level: 15% higher	activity level: 15% lower
2	variable costs:
3
4
5
6
7	fixed costs:
8
9
10
11
12