Imperial Tile is planning to sell 900 boxes of ceramic tile, with production estimated at 870 boxes during March. Each box of tile requires 44 pounds of clay mix and a quarter hour of direct labor. Clay mix costs $0.40 per pound and employees of the company are paid $12.00 per hour. Manufacturing overhead is applied at a rate of 110% of direct labor costs. Imperial has 3,900 pounds of clay mix in beginning inventory and wants to have 4,500 pounds in ending inventory. What is the total amount to be budgeted for manufacturing overhead for the month? 1) $11,484 2) $2,970 3) $11,880 4) $2,871

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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Imperial Tile is planning to sell 900 boxes of ceramic tile, with production estimated
at 870 boxes during March. Each box of tile requires 44 pounds of clay mix and a
quarter hour of direct labor. Clay mix costs $0.40 per pound and employees of the
company are paid $12.00 per hour. Manufacturing overhead is applied at a rate of
110% of direct labor costs. Imperial has 3,900 pounds of clay mix in beginning
inventory and wants to have 4,500 pounds in ending inventory.
What is the total amount to be budgeted for manufacturing overhead for the month?
1) $11,484
2) $2,970
3) $11,880
4) $2,871
Transcribed Image Text:Imperial Tile is planning to sell 900 boxes of ceramic tile, with production estimated at 870 boxes during March. Each box of tile requires 44 pounds of clay mix and a quarter hour of direct labor. Clay mix costs $0.40 per pound and employees of the company are paid $12.00 per hour. Manufacturing overhead is applied at a rate of 110% of direct labor costs. Imperial has 3,900 pounds of clay mix in beginning inventory and wants to have 4,500 pounds in ending inventory. What is the total amount to be budgeted for manufacturing overhead for the month? 1) $11,484 2) $2,970 3) $11,880 4) $2,871
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