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Accounting
140,000 35,000

140,000 35,000

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Cerium Inc. produces a variety of household cleaning products. Cerium's controller has developed standard costs for the following four overhead items Variable Rate per Direct Labor Hour Overhead Item Maintenance Power Indirect labor Rent 140,000 35,000 Next year, Cenum expects production to require 58,000 direct labor hours. Required: Total Fixed Cost $113,000 1. Prepare an overhead budget for the expected level of direct labor hours for the coming year. Cerium Inc. Overhead Budget For the Coming Year Line Item Description Rate per Hour Variable costs: Maintenance Power Indirect labor Total variable cost Fixed costs Maintenance Indirect labor $0.20 0.68 3.70 Activity Level 58,000 Hours 00 0.000 Protnie Newt
Transcribed Image Text:Cerium Inc. produces a variety of household cleaning products. Cerium's controller has developed standard costs for the following four overhead items Variable Rate per Direct Labor Hour Overhead Item Maintenance Power Indirect labor Rent 140,000 35,000 Next year, Cenum expects production to require 58,000 direct labor hours. Required: Total Fixed Cost $113,000 1. Prepare an overhead budget for the expected level of direct labor hours for the coming year. Cerium Inc. Overhead Budget For the Coming Year Line Item Description Rate per Hour Variable costs: Maintenance Power Indirect labor Total variable cost Fixed costs Maintenance Indirect labor $0.20 0.68 3.70 Activity Level 58,000 Hours 00 0.000 Protnie Newt
- Fixed costs: Maintenance Indirect labor Rent Total fixed costs Total overhead costs 2. Prepare an overhead budget that reflects production that is 15% higher than expected and for production that is 15% lower than expected. Activity Level Activity Level Variable costs: Maintenance Power Indirect labor Total variable costs Fixed costs: Maintenance Indirect labor Rent Total fixed costs Total overhead costs i Rate per Hour Hours Hours
Transcribed Image Text:- Fixed costs: Maintenance Indirect labor Rent Total fixed costs Total overhead costs 2. Prepare an overhead budget that reflects production that is 15% higher than expected and for production that is 15% lower than expected. Activity Level Activity Level Variable costs: Maintenance Power Indirect labor Total variable costs Fixed costs: Maintenance Indirect labor Rent Total fixed costs Total overhead costs i Rate per Hour Hours Hours
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