20. Ceiling Fans by Ike's overhead budget for 2009 was as follows: Factory supervision $300,000 Utilities costs 150,000 Insurance 28,000 Property taxes 22,000 Depreciation 100,000 Total $600,000 600,000 units were produced in 2009. Direct labor cost is $18,000,000. For both 2009 and 2010, each unit required 3 direct labor hours at $10 per hour. In 2010, property taxes, insurance, and depreciation are expected to stay at 2009 levels. Utilities costs vary proportionally with units produced. Factory supervision increases by increments of $30,000 for every 200,000 increases in direct labor hours. The 2010 expected production is 1,200,000 units. What will be the value for factory supervision in the 2010 overhead budget? a. $570,000 b. $270,000 c. $450,000 d. $400,000 Show all workings please
20. Ceiling Fans by Ike's overhead budget for 2009 was as follows: Factory supervision $300,000 Utilities costs 150,000 Insurance 28,000 Property taxes 22,000 Depreciation 100,000 Total $600,000 600,000 units were produced in 2009. Direct labor cost is $18,000,000. For both 2009 and 2010, each unit required 3 direct labor hours at $10 per hour. In 2010, property taxes, insurance, and depreciation are expected to stay at 2009 levels. Utilities costs vary proportionally with units produced. Factory supervision increases by increments of $30,000 for every 200,000 increases in direct labor hours. The 2010 expected production is 1,200,000 units. What will be the value for factory supervision in the 2010 overhead budget? a. $570,000 b. $270,000 c. $450,000 d. $400,000 Show all workings please
Chapter1: Financial Statements And Business Decisions
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The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.
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Transcribed Image Text:20. Ceiling Fans by Ike's overhead budget for 2009 was as follows: Factory supervision $300,000 Utilities
costs 150,000 Insurance 28,000 Property taxes 22,000 Depreciation 100,000 Total $600,000 600,000
units were produced in 2009. Direct labor cost is $18,000,000. For both 2009 and 2010, each unit
required 3 direct labor hours at $10 per hour. In 2010, property taxes, insurance, and depreciation are
expected to stay at 2009 levels. Utilities costs vary proportionally with units produced. Factory supervision
increases by increments of $30,000 for every 200,000 increases in direct labor hours. The 2010 expected
production is 1,200,000 units. What will be the value for factory supervision in the 2010 overhead
budget? a. $570,000 b. $270,000 c. $450,000 d. $400,000
Show all workings please
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