nanufacturing overhead budget for the Ironing Department, which is based on an activity index of direct labor hours. Rate per Direct Labor Hour Variable costs Indirect labor Indirect materials Factory utilities Factory repairs Annual Fixed Costs $0.42 Supervision 0.55 Depreciation 0.32 Insurance 0.20 Rent $46,800 16,920 14,760 28,080 The master overhead budget was prepared on the expectation that 479,200 direct labor hours will be worked during the year. In June, 46,100 direct labor hours were worked. At that level of activity, actual costs were as shown elow. Variable-per direct labor hour: indirect labor $0.44, indirect materials $0.54, factory utilities $0.35, and factory repairs $0.24.

nanufacturing overhead budget for the Ironing Department, which is based on an activity index of direct labor hours. Rate per Direct Labor Hour Variable costs Indirect labor Indirect materials Factory utilities Factory repairs Annual Fixed Costs $0.42 Supervision 0.55 Depreciation 0.32 Insurance 0.20 Rent $46,800 16,920 14,760 28,080 The master overhead budget was prepared on the expectation that 479,200 direct labor hours will be worked during the year. In June, 46,100 direct labor hours were worked. At that level of activity, actual costs were as shown elow. Variable-per direct labor hour: indirect labor $0.44, indirect materials $0.54, factory utilities $0.35, and factory repairs $0.24.

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter8: Budgeting For Planning And Control

Section: Chapter Questions

Problem 38P: Greiner Company makes and sells high-quality glare filters for microcomputer monitors. John Craven,...

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Nathan Davidson, financial analyst at LMN Corporation, is examining the behavior of quarterly utility costs for budgeting purposes. Davidson collects the following data on machine-hours worked and utility costs for the past 8 quarters: (Click the icon to view the data.) Read the requirements. Requirement 1. Estimate the cost function for the quarterly data using the high-low method. (Complete all answer boxes.) Data table + Quarter Machine-Hours Utility Costs Quarter 1 100,000 $ 265,000 Quarter 2 55,000 200,000 Quarter 3 90,000 250,000 Quarter 4 105,000 280,000 Quarter 5 70,000 220,000 Quarter 6 95,000 260,000 Quarter 7 85,000 275,000 Quarter 8 80,000 245,000 Print Done - ☑ Requirements 1. Estimate the cost function for the quarterly data using the high-low method. 2. Plot and comment on the estimated cost function. 3. Davidson anticipates that LMN will operate machines for 105,000 hours in quarter 9. Calculate the predicted utility costs in quarter 9 using the cost function estimated…
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