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Sheridan, Inc. uses a flexible budget for manufacturing overhead based on machine hours. Variable manufacturing overhead costs per machine hour are as follows: Indirect
Sheridan, Inc. uses a flexible budget for manufacturing overhead based on machine hours. Variable manufacturing overhead costs per machine hour are as follows: Indirect labor $5.00 Indirect materials 2.50 Maintenance 0.80 Utilities. 0.30 Fixed overhead costs per month are: Supervision Insurance Property taxes Depreciation $870 270 370 970 The company believes it will normally operate in a range of 2,700 to 4,700 machine hours per month Prepare a flexible manufacturing overhead budget for the expected range of activity using increments of 1.000 machine hours. (List variable costs before fixed costs) Activity level Machine hours SHERIDAN, INC. Monthly Flexible Manufacturing Overhead Budget 2,700 3,700 4,700
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