The following budget information relates to Mercedes Benz Corporation.

Variable manufacturing overhead costs per machine hour are as follows:

Indirect Labor $7.25

Indirect Materials 3.50

Maintenance .95

Utilities .52

Fixed overhead costs per month are:

Supervision $800

Insurance 350

Property Taxes 400

Depreciation 900

The normal operating range is 6,000 to 10,000 machine hours per month.

INSTRUCTIONS

Mercedes-Benz would like a flexible manufacturing overhead budget prepared

based on machine hours. Given the range of activity above, prepare the

budget using increments of 2,000 machine hours.