Mountain Trails manufactures backpacks for adventurers. Management is preparing budgets for the month, and is trying to determine the Overhead Budget amounts. Variable overhead is budgeted to be incurred at a rateof $5 per direct labor hour (including utilities, indirect materials, and indirect labor). Budgeted direct labor hours are 6,300 hours for the period. Fixed overhead amounts include the following: Factory rent $5,000; Factorysupervisor salary $8,400; Depreciation $11,200; Insurance $2,100; and Factory security $3,500.What is the predetermined overhead rate (applied on the basis of direct labor hours? (Round to 3 decimal places)Select one:a. $16.666b. $5.000C. $4.794O d. $11.666e. None of these options are correct.

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Answered: Mountain Trails manufactures backpacks…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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XYZ Company is preparing its Manufacturing Overhead budget for the month of March. The budgeted variable manufacturing overhead is $5 per direct labor-hour. The budgeted fixed manufacturing overhead is $31,000 per month, which includes $5,000 of noncash costs (primarily depreciation of plant assets). If the budgeted direct labor-hours for March is 5,500. How much is the March’s budgeted cash disbursements for manufacturing overhead? Select one: a. $59,000 b. $64,500 c. $58,500 d. $53,500 e. None of the given answers
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