P24-2A (no graph)

t 2017. r Prepare a flexible budget report for October hours over the relevant range for th Uverhead flexible budget for each increment of a) Total costs: DLH 27,000, h nding December 31, $53,750; DLH 36,000, e year e Comment on management's efficiency in controlling manufacturing overhead $65,000 b) Total $1,182 U costs in October. p24-2A Zelmer Company manufactures tablecloths. Sales have grown rapidly over the As a result, the president has installed a budgetary control system for 20 g data were used in developing the master manufacturing overhead budget ing Department, which is based on an activity index of direct labor hours O2) past 2 years. Prepare flexible budget, budget report, and graph for a 17. narusfactaring (LO 2) t labor hours. Rate per Direct Variable Costs Indirect labor Indirect materials Factory utilities Factory repairs Labor Hour Annual Fixed Costs $0.40 0.50 0.30 0.20 Supervision $48,000 Depreciation 18,000 12,000 30,000 Insurance The master overhead budget was prepared on the expectation that 480,000 direct labor hours will be worked during the year. In June, 41,000 direct labor hours were worked. At that level of activity, actual costs were as shown below Variable-per direct labor hour: indirect labor $0.44, indirect materials $0.48, factory utilities $0.32, and factory repairs $0.25. Fixed: same as budgeted. Instructions (a) Prepare a monthly manufacturing overhead flexible budget for the year ending Decem- (a) Total costs: 35,000 DLH, 579,000 ber 31, 2017, assuming production levels range from 35,000 to 50,000 direct labor $58,000: 50,000 DIH (b) Budget $66,400 Actual $70,090 b) Prepare a budget report for June comparing actual results with budget data based on the flexible budget. c) Were costs effectively controlled? Explain (d) State the formula for computing the total budgeted costs for the Ironing Department. (e) Prepare the flexible budget graph, showing total budgeted costs at 35,000 and 45,000 direct labor hours. Use increments of 5,000 direct labor hours on the horizontal axis and increments of $10,000 on the vertical axis