Question 4, P9-37 (simila... Part 1 of 13 HW Score: 15.33%, 6.13 of 40 points O Points: 0 of 10 Save Fortune Lager has just purchased the Austin Brewery The brewery is 2 years old and uses absorption costing It will "sell its product to Fortune Lager at $45 per barrel. Peter Bryant, Fortune Lager's controller obtains the following information about Austin Brewery's capacity and budgeted fixed manufacturing costs for 2020 (Click the icon to view the information) Read the requirement Requirement 1. Compute the budgeted fixed manufacturing overhead rate per barrel for each of the denominator-level capacity concepts Explain why they are different Begin by determing the formula to calculate the budgeted fixed manufacturing overhead rate per barrel, then compute the rate for each of the denominator-level capacity concepts. (Abbreviations used Budg = budgeted, MOH = manufacturing overhead Round the rates to the nearest cent) Budgeted fixed MOH rato per barrel uses absorption costing bacal Dator Bruant Cartuno Lagar's controller obtains the following info Data Table D E B Budgeted Fixed Manufacturing Overhead per Period Days of Hours of Production Production Barrels per Period per Day per Hour 358 22 535 $ 28,200,000 Denominator-Level 1 Capacity Concept 2 Theoretical capacity 3 Practical capacity 4 Normal capacity utilization Master-budget capacity 5 utilization for each half year $ 28,200,000 348 20 505 $ 28,200,000 348 20 405 $ 174 20 325 6 (a) January-June 2020 7 (b) July-December 2020 14,100,000 14,100,000 $ 174 20 485 Print Done Requirements x 1. Compute the budgeted fixed manufacturing overhead rate per barrel for each of the denominator-level capacity concepts. Explain why they are different. 2. In 2020, the Austin Brewery reported these production results: A B 12 Beginning inventory in barrels, 1-1-2020 13 Production in barrels 2,610,000 14 Ending inventory in barrels, 12-31-2020 190,000 15 Actual variable manufacturing costs $ 79,213,500 16 Actual fixed manufacturing overhead costs $ 27,300,000 There are no variable cost variances Fixed manufacturing overhead cost variances are written off to cost of goods sold in the period in which they occur. Compute the Austin Brewery's operating income when the denominator-level capacity is (a) theoretical capacity, (b) practical capacity, and (c) normal capacity utilization Print Done