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4.3 Unit Homework Flexible Budget In an attempt to improve budgeting, the controller for Engersol, Inc., has developed a flexible budget for overhead costs. Engersol, Inc., makes two types of products, commercial floor cleaners and household floor cleaners. The company expects to produce 400,000 units of the commercial cleaner and 140,000 units of the household cleaner during the coming year. The commercial cleaner requires 0.05 direct labor hour per unit, and the household cleaner requires 0.08. The controller has developed the following cost formulas for each of the four overhead items: Maintenance Power Indirect labor Rent Cost Formula $34,300 $1.25 DUH $0.50 DLH $68,500 $2.30 DLH $31,100 Required: 1. Prepare an overhead budget for the expected activity level for the coming year. Engersol, Inc. Overhead Budget For the Year Ended December 31 Per DLH Budgeted direct labor hours Variable costs: Maintenance Power Learning Objective 4 30

4.3 Unit Homework Flexible Budget In an attempt to improve budgeting, the controller for Engersol, Inc., has developed a flexible budget for overhead costs. Engersol, Inc., makes two types of products, commercial floor cleaners and household floor cleaners. The company expects to produce 400,000 units of the commercial cleaner and 140,000 units of the household cleaner during the coming year. The commercial cleaner requires 0.05 direct labor hour per unit, and the household cleaner requires 0.08. The controller has developed the following cost formulas for each of the four overhead items: Maintenance Power Indirect labor Rent Cost Formula $34,300 $1.25 DUH $0.50 DLH $68,500 $2.30 DLH $31,100 Required: 1. Prepare an overhead budget for the expected activity level for the coming year. Engersol, Inc. Overhead Budget For the Year Ended December 31 Per DLH Budgeted direct labor hours Variable costs: Maintenance Power Learning Objective 4 30

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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4.3 Unit Homework > Flexible Budget In an attempt to improve budgeting, the controller for Engersol, Inc., has developed a flexible budget for overhead costs. Engersol, Inc., makes two types of products, commercial floor cleaners and household floor cleaners. The company expects to produce 400,000 units of the commercial cleaner and 140,000 units of the household cleaner during the coming year. The commercial cleaner requires 0.05 direct labor hour per unit, and the household cleaner requires 0.08. The controller has developed the following cost formulas for each of the four overhead items: Maintenance Power Indirect labor Rent Required: Cost Formula $34,300 $1.25 DLH $0.50 DLH $68,500+ $2.30 DLH $31,100 Learning Objective 4 1. Prepare an overhead budget for the expected activity level for the coming year. Engersol, Inc. Overhead Budget For the Year Ended December 31 Per DLH Budgeted direct labor hours Variable costs: Maintenance Power
Transcribed Image Text:4.3 Unit Homework > Flexible Budget In an attempt to improve budgeting, the controller for Engersol, Inc., has developed a flexible budget for overhead costs. Engersol, Inc., makes two types of products, commercial floor cleaners and household floor cleaners. The company expects to produce 400,000 units of the commercial cleaner and 140,000 units of the household cleaner during the coming year. The commercial cleaner requires 0.05 direct labor hour per unit, and the household cleaner requires 0.08. The controller has developed the following cost formulas for each of the four overhead items: Maintenance Power Indirect labor Rent Required: Cost Formula $34,300 $1.25 DLH $0.50 DLH $68,500+ $2.30 DLH $31,100 Learning Objective 4 1. Prepare an overhead budget for the expected activity level for the coming year. Engersol, Inc. Overhead Budget For the Year Ended December 31 Per DLH Budgeted direct labor hours Variable costs: Maintenance Power
Required: 1. Prepare an overhead budget for the expected activity level for the coming year. Engersol, Inc. Overhead Budget For the Year Ended December 31 Per DLH Budgeted direct labor hours Variable costs: Maintenance Power Indirect labor Total variable costs Fixed costs: Maintenance Indirect labor Rent Total fixed costs Total overhead costs 4.3 Unit Homework 2. Prepare an overhead budget that reflects production that is 10 percent higher than expected (for both products). Engersol, Inc. Overhead Budget Total overhead costs Budgeted direct labor hours. Variable costs: Maintenance Power 2. Prepare an overhead budget that reflects production that is 10 percent higher than expected (for both products). Engersol, Inc. Overhead Budget For the Year Ended December 31 Per DLH Indirect labor Total variable costs Fixed costs: Maintenance Indirect labor Rent Total fixed costs Total overhead costs Budgeted direct labor hours Variable costs: Maintenance. Power Indirect labor Learning Objective 4 Total variable costs Prepare an overhead budget for production that is 20 percent lower than expected. Engersol, Inc. Fixed costs: 000 000 Prepare an overhead budget for produ Engersol, Inc. Overhead Budget For the Year Ended December 31 Per DLH Maintenance Indirect labor Rent Learning Objective 4 Total fixed costs Total overhead costs 0 000 000 Learning Objective 4 001 000 Jected. 4 3. Which of the four data analytic types-descriptive, diagnostic, predictive, or prescriptive-is being used in creating the three flexible budgets? (See Exhibits 2.5 and 2.6, pp. 37, 40, for a review of data analytic types.) The flexible budgets are used ( to determine how well the company will do under various sales scenarios. Previous Next
Transcribed Image Text:Required: 1. Prepare an overhead budget for the expected activity level for the coming year. Engersol, Inc. Overhead Budget For the Year Ended December 31 Per DLH Budgeted direct labor hours Variable costs: Maintenance Power Indirect labor Total variable costs Fixed costs: Maintenance Indirect labor Rent Total fixed costs Total overhead costs 4.3 Unit Homework 2. Prepare an overhead budget that reflects production that is 10 percent higher than expected (for both products). Engersol, Inc. Overhead Budget Total overhead costs Budgeted direct labor hours. Variable costs: Maintenance Power 2. Prepare an overhead budget that reflects production that is 10 percent higher than expected (for both products). Engersol, Inc. Overhead Budget For the Year Ended December 31 Per DLH Indirect labor Total variable costs Fixed costs: Maintenance Indirect labor Rent Total fixed costs Total overhead costs Budgeted direct labor hours Variable costs: Maintenance. Power Indirect labor Learning Objective 4 Total variable costs Prepare an overhead budget for production that is 20 percent lower than expected. Engersol, Inc. Fixed costs: 000 000 Prepare an overhead budget for produ Engersol, Inc. Overhead Budget For the Year Ended December 31 Per DLH Maintenance Indirect labor Rent Learning Objective 4 Total fixed costs Total overhead costs 0 000 000 Learning Objective 4 001 000 Jected. 4 3. Which of the four data analytic types-descriptive, diagnostic, predictive, or prescriptive-is being used in creating the three flexible budgets? (See Exhibits 2.5 and 2.6, pp. 37, 40, for a review of data analytic types.) The flexible budgets are used ( to determine how well the company will do under various sales scenarios. Previous Next
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