Exercise 8-15 (Algo) Direct Labor and Manufacturing Overhead Budgets [LO8-5, LO8-6] The Production Department of Hruska Corporation has submitted the following forecast of units to be produced by quarter for the upcoming fiscal year: 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter Units to be produced 10,600 9,600 11,600 12,600 Each unit requires 0.30 direct labor-hours and direct laborers are paid $12.50 per hour. In addition, the variable manufacturing overhead rate is $1.50 per direct labor-hour. The fixed manufacturing overhead is $86,000 per quarter. The only noncash element of manufacturing overhead is depreciation, which is $26,000 per quarter. Required: 1. Calculate the company’s total estimated direct labor cost for each quarter of the the upcoming fiscal year and for the year as a whole. 2. and 3. Calculate the company’s total estimated manufacturing overhead cost and the cash disbursements for manufacturing overhead for each quarter of the upcoming fiscal year and for the year as a whole.
Master Budget
A master budget can be defined as an estimation of the revenue earned or expenses incurred over a specified period of time in the future and it is generally prepared on a periodic basis which can be either monthly, quarterly, half-yearly, or annually. It helps a business, an organization, or even an individual to manage the money effectively. A budget also helps in monitoring the performance of the people in the organization and helps in better decision-making.
Sales Budget and Selling
A budget is a financial plan designed by an undertaking for a definite period in future which acts as a major contributor towards enhancing the financial success of the business undertaking. The budget generally takes into account both current and future income and expenses.
Exercise 8-15 (Algo) Direct Labor and Manufacturing Overhead Budgets [LO8-5, LO8-6]
The Production Department of Hruska Corporation has submitted the following
| 1st Quarter | 2nd Quarter | 3rd Quarter | 4th Quarter | |
|---|---|---|---|---|
| Units to be produced | 10,600 | 9,600 | 11,600 | 12,600 |
Each unit requires 0.30 direct labor-hours and direct laborers are paid $12.50 per hour.
In addition, the variable manufacturing overhead rate is $1.50 per direct labor-hour. The fixed manufacturing overhead is $86,000 per quarter. The only noncash element of manufacturing overhead is
Required:
1. Calculate the company’s total estimated direct labor cost for each quarter of the the upcoming fiscal year and for the year as a whole.
2. and 3. Calculate the company’s total estimated
![**Exercise 8-15 (Algo) Direct Labor and Manufacturing Overhead Budgets [LO8-5, LO8-6]**
The Production Department of Hruska Corporation has submitted the following forecast of units to be produced by quarter for the upcoming fiscal year:
| | 1st Quarter | 2nd Quarter | 3rd Quarter | 4th Quarter |
|-------------------|-------------|-------------|-------------|-------------|
| Units to be produced | 10,600 | 9,600 | 11,600 | 12,600 |
Each unit requires 0.30 direct labor-hours and direct laborers are paid $12.50 per hour.
In addition, the variable manufacturing overhead rate is $1.50 per direct labor-hour. The fixed manufacturing overhead is $86,000 per quarter. The only non-cash element of manufacturing overhead is depreciation, which is $26,000 per quarter.
**Required:**
1. Calculate the company's total estimated direct labor cost for each quarter of the upcoming fiscal year and for the year as a whole.
2. and 3. Calculate the company’s total estimated manufacturing overhead cost and the cash disbursements for manufacturing overhead for each quarter of the upcoming fiscal year and for the year as a whole.
**Complete this question by entering your answers in the tabs below.**
**Requirement 1**
Calculate the company’s total estimated direct labor cost for each quarter of the upcoming fiscal year and for the year as a whole. (*Round "Direct labor time per unit (hours)" answers to 2 decimal places.*)
| | 1st Quarter | 2nd Quarter | 3rd Quarter | 4th Quarter | Year |
|------------------------|-------------|-------------|-------------|-------------|------|
| Total direct labor cost | | | | | |
**Requirement 2 and 3**
(Note: The entry section and tabs for requirements 2 and 3 are not shown but are prompted for completion.)](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F16afad9b-824d-42b7-9e40-175f68ea31da%2F6fce4e0c-4392-48c0-8bea-5b29440e3043%2F8j01qm_processed.png&w=3840&q=75)
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