Lewison Inc. bases its manufacturing overhead budget on budgeted direct labor-hours. The variable overhead rate is $1.75 per direct labor-hour. The company's budgeted fixed manufacturing overhead is $95,000 per month, which includes depreciation of $45,000. All other fixed manufacturing overhead costs represent current cash flows. The September direct labor budget indicates that 16,500 direct labor-hours will be required in that month. Required: a. Determine the cash disbursement for manufacturing overhead for September, b. Determine the predetermined overhead rate for September.
Lewison Inc. bases its manufacturing overhead budget on budgeted direct labor-hours. The variable overhead rate is $1.75 per direct labor-hour. The company's budgeted fixed manufacturing overhead is $95,000 per month, which includes depreciation of $45,000. All other fixed manufacturing overhead costs represent current cash flows. The September direct labor budget indicates that 16,500 direct labor-hours will be required in that month. Required: a. Determine the cash disbursement for manufacturing overhead for September, b. Determine the predetermined overhead rate for September.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Lewison Inc. bases its manufacturing overhead budget on budgeted direct labor-hours. The variable
overhead rate is $1.75 per direct labor-hour. The company's budgeted fixed manufacturing overhead
is $95,000 per month, which includes depreciation of $45,000. All other fixed manufacturing overhead
costs represent current cash flows. The September direct labor budget indicates that 16,500 direct
labor-hours will be required in that month.
Required:
a. Determine the cash disbursement for manufacturing overhead for September.
b. Determine the predetermined overhead rate for September.
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