P24. Prepare flexible hudget and budget report formam ufacturing overhead Bumblebee Company estimates that 300,000 direct labor hours will be worked during the coming year, 2017. in the Packaging Department. On this basis, the budgeted manufacturing overhead cost data, shown below, are computed for the year. Fixed Overhead Costs Supervision $96,000 Depreciation 72,000 Insurance 30,000 24,000 Property taxes 18,000 $240,000 Variable Overhead Costs Indirect labor $126,000 Indirect materials 90,000 Repairs 69,000 Utilities 72.000 Lubricants 18.000 $375,000 Rent It is estimated that direct labor hours worked each month will range from 27,000 to 36,000 hours. During October 27,000 direct labor hours were worked and the following overhead costs were incurred. Fixed overhead costs: supervision $8,000, depreciation $6,000, insurance $2,460, rent $2,000, and property taxes $1,500. Variable overhead costs: indirect labor $12,432, indirect materials $7,680, repairs $6,100, utilities $6,840, and lubricants $1,920. Instructions a) Prepare a monthly manufacturing overhead flexible budget for each increment of 3,000 direct labor hours over the relevant range for the year ending December 31, 2017. (compute per hour and monthly amounts) (6) Prepare a flexible budget report for October comment on management's efficiency in controlling manufacturing overhead costs in October (a) Prepare a monthly manufacturing overhead flexible budget for each increment of 3.000 direct labor hours over the relevant range for the year ending December 31, 2017. (compute per hour and monthly amounts) BUMBLEBEE COMPANY Packaging Department Monthly Manufacturing Overhead Flexible Budget For the Year 2017 Activity level Direct labor hours 27.000 30.000 33.000 36,000 Per Hour Rats ? ? ? ? ? ? ? Variable costs Indirect labor Indirect materials Repairs Utilities Lubricants Total variable costs ? ? ? ? ? ? 2 ? 2 ? ? 2 Per Month 2 ? ? ? 2 ? ? Fixed costs Supervision Depreciation Insurance Rent Property taxes Total fixed costs ? 2 2 ? ? ? 2 ? ? Total costs (b) Prepare a flexible budget report for October BUMBLEBEE COMPANY Packaging Department Manufacturing Overhead Flexible Budget Report For the Month Ended October 31, 2017 Budget at 27.000 DLH Actual Costs 27.000 DLH Difference Favorable F Unfavorable U ? ? Direct labor hours Variable costs Indirect labor Indirect materials Repairs Utilities Lubricants Total variable costs ? ? ? ? Value Value Value Value Value ? ? ? ? ? - ? ? Fixed costs Supervision Depreciation Insurance Rent Property taxes Total fixed costs Value Value Value Value Value ? Value Value Value Value Value ? ? ()
