This is illustration 23.16, the one the paper says to refer to as a guide
oct 2: Flexible Budget and Budget Report (10 points) Moodle by the deadline specified. Do NOT email your filel Upload your file to Moodle Halloween Supplies, Inc. esti during 2019 in the Pa aplies. Inc. estimates that 120,000 direct labor hours will be worked to in the Packaging Department. Based on this estimate, the following doet was developed for manufacturing overhead costs. Variable Overhead Costs Indirect labor $45,000 Indirect materials 28,500 Repairs 27,600 Utilities 17,400 Lubricants 6,600 $125,100 Fixed Overhead Costs Supervision $84,000 Depreciation 24,000 Insurance 15,000 Rent 10,800 Property taxes 7,200 $141,000 It is estimated that direct labor hours worked each month will range from 8,000 to 12,000 hours. During January, 10,000 direct labor hours were worked and the following overhead costs were incurred. Variable Overhead Costs Indirect labor $4,100 Indirect materials 2,300 Repairs 2,200 Utilities 1,500 Lubricants 600 $10,700 Fixed Overhead Costs Supervision $7,000 Depreciation 2,000 Insurance 1,250 Rent 900 600 Property taxes $11,750 Instructions for Project 2: Using Excel, prepare a monthly flexible manufacturing overhead budget for each Increment of 1,000 direct labor hours over the relevant range for the year ending December 31, 2019. Refer to Illustration 23 -13 in the chapter for an example. Using Excel, prepare a manufacturing overhead budget report for January form. Refer to Illustration 23-16 in the chapter as a guide. -12 CHAPTER 23 Budgetary Control and Responsibility Accounting ILLUSTRATION 23.16 Overhead flexible budget report Fox Company D Fox Company Manufacturing Overhead Flexible Budget Report Finishing Department For the Month Ended January 31, 2020 Favorable - F Difference Favorab Unfavorable Budget at 9,000 DLH Direct labor hours (DLH) Actual costs at 9.000 DLH sts at rable. U Variable costs Indirect materials ($1.50) Indirect labor ($2.00) Utilities (50.50)a Total variable costs $13,500 18,000 4,500 36,000 $14,000 17,000 4,600 35,600 S 500 1,000 100 400 15 16 Fixed costs Depreciation Supervision Property taxes Total fixed costs Total costs 15,000 10,000 5,000 30,000 $66,000 15,000 10,000 5,000 30,000 $65,600 400 22 aCost per direct labor hour In subsequent months, Fox Company will prepare other flexible budget reports. For each month, the budget data are based on the actual activity level attained. In February that level may be 11,000 direct labor hours, in July 10,000, and so on. Note that this flexible budget is based on a single cost driver. A more accurate budeet often can be developed using the activity-based costing concepts explained in Chapter 17
