Flexible Budget for Various Levels of Activity Palladium Inc. produces a variety of household cleaning products. Palladium’s controller has developed standard costs for the following four overhead items: Overhead Item Total Fixed Cost Variable Rate per Direct Labor Hour Maintenance $ 86,000 $0.20 Power 0.45 Indirect labor 140,000 2.10 Rent 35,000 Next year, Palladium expects production to require 90,000 direct labor hours. Required: 1. Prepare an overhead budget for the expected level of direct labor hours for the coming year. Palladium Inc. Overhead Budget For the Coming Year Variable costs: Rate per Hour Activity Level 90,000 Hours Maintenance $fill in the blank 0ef6bf055076030_1 $fill in the blank 0ef6bf055076030_2 Power fill in the blank 0ef6bf055076030_3 fill in the blank 0ef6bf055076030_4 Indirect labor fill in the blank 0ef6bf055076030_5 fill in the blank 0ef6bf055076030_6 Total variable cost $fill in the blank 0ef6bf055076030_7 Fixed costs: Maintenance $fill in the blank 0ef6bf055076030_8 Indirect labor fill in the blank 0ef6bf055076030_9 Rent fill in the blank 0ef6bf055076030_10 Total fixed costs $fill in the blank 0ef6bf055076030_11 Total overhead costs $fill in the blank 0ef6bf055076030_12 2. Prepare an overhead budget that reflects production that is 15% higher than expected and for production that is 15% lower than expected. Activity Level Rate per Hour fill in the blank 4e970707000bfc3_1 Hours fill in the blank 4e970707000bfc3_2 Hours Variable costs: Maintenance $fill in the blank 4e970707000bfc3_3 $ fill in the blank 4e970707000bfc3_4 $ fill in the blank 4e970707000bfc3_5 Power fill in the blank 4e970707000bfc3_6 fill in the blank 4e970707000bfc3_7 fill in the blank 4e970707000bfc3_8 Indirect labor fill in the blank 4e970707000bfc3_9 fill in the blank 4e970707000bfc3_10 fill in the blank 4e970707000bfc3_11 Total variable costs $fill in the blank 4e970707000bfc3_12 $fill in the blank 4e970707000bfc3_13 Fixed costs: Maintenance $ fill in the blank 4e970707000bfc3_14 $ fill in the blank 4e970707000bfc3_15 Indirect labor fill in the blank 4e970707000bfc3_16 fill in the blank 4e970707000bfc3_17 Rent fill in the blank 4e970707000bfc3_18 fill in the blank 4e970707000bfc3_19 Total fixed costs $fill in the blank 4e970707000bfc3_20 $fill in the blank 4e970707000bfc3_21 Total overhead costs $fill in the blank 4e970707000bfc3_22 $fill in the blank 4e970707000bfc3_23

Flexible Budget for Various Levels of Activity Palladium Inc. produces a variety of household cleaning products. Palladium’s controller has developed standard costs for the following four overhead items: Overhead Item Total Fixed Cost Variable Rate per Direct Labor Hour Maintenance $ 86,000 $0.20 Power 0.45 Indirect labor 140,000 2.10 Rent 35,000 Next year, Palladium expects production to require 90,000 direct labor hours. Required: 1. Prepare an overhead budget for the expected level of direct labor hours for the coming year. Palladium Inc. Overhead Budget For the Coming Year Variable costs: Rate per Hour Activity Level 90,000 Hours Maintenance $fill in the blank 0ef6bf055076030_1 $fill in the blank 0ef6bf055076030_2 Power fill in the blank 0ef6bf055076030_3 fill in the blank 0ef6bf055076030_4 Indirect labor fill in the blank 0ef6bf055076030_5 fill in the blank 0ef6bf055076030_6 Total variable cost $fill in the blank 0ef6bf055076030_7 Fixed costs: Maintenance $fill in the blank 0ef6bf055076030_8 Indirect labor fill in the blank 0ef6bf055076030_9 Rent fill in the blank 0ef6bf055076030_10 Total fixed costs $fill in the blank 0ef6bf055076030_11 Total overhead costs $fill in the blank 0ef6bf055076030_12 2. Prepare an overhead budget that reflects production that is 15% higher than expected and for production that is 15% lower than expected. Activity Level Rate per Hour fill in the blank 4e970707000bfc3_1 Hours fill in the blank 4e970707000bfc3_2 Hours Variable costs: Maintenance $fill in the blank 4e970707000bfc3_3 $ fill in the blank 4e970707000bfc3_4 $ fill in the blank 4e970707000bfc3_5 Power fill in the blank 4e970707000bfc3_6 fill in the blank 4e970707000bfc3_7 fill in the blank 4e970707000bfc3_8 Indirect labor fill in the blank 4e970707000bfc3_9 fill in the blank 4e970707000bfc3_10 fill in the blank 4e970707000bfc3_11 Total variable costs $fill in the blank 4e970707000bfc3_12 $fill in the blank 4e970707000bfc3_13 Fixed costs: Maintenance $ fill in the blank 4e970707000bfc3_14 $ fill in the blank 4e970707000bfc3_15 Indirect labor fill in the blank 4e970707000bfc3_16 fill in the blank 4e970707000bfc3_17 Rent fill in the blank 4e970707000bfc3_18 fill in the blank 4e970707000bfc3_19 Total fixed costs $fill in the blank 4e970707000bfc3_20 $fill in the blank 4e970707000bfc3_21 Total overhead costs $fill in the blank 4e970707000bfc3_22 $fill in the blank 4e970707000bfc3_23

Managerial Accounting: The Cornerstone of Business Decision-Making

7th Edition

ISBN:9781337115773

Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Chapter9: Profit Planning And Flexible Budgets

Section: Chapter Questions

Problem 63E: Use the following information for Exercises 9-63 and 9-64: Palladium Inc. produces a variety of...

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Flexible Budget for Various Levels of Activity

Palladium Inc. produces a variety of household cleaning products. Palladium’s controller has developed standard costs for the following four overhead items:

Overhead Item	Total Fixed Cost	Variable Rate per Direct Labor Hour
Maintenance	$ 86,000	$0.20
Power		0.45
Indirect labor	140,000	2.10
Rent	35,000

Next year, Palladium expects production to require 90,000 direct labor hours.

Required:

1. Prepare an overhead budget for the expected level of direct labor hours for the coming year.

Palladium Inc.
Overhead Budget
For the Coming Year
Variable costs:	Rate per Hour	Activity Level 90,000 Hours
Maintenance	$fill in the blank 0ef6bf055076030_1	$fill in the blank 0ef6bf055076030_2
Power	fill in the blank 0ef6bf055076030_3	fill in the blank 0ef6bf055076030_4
Indirect labor	fill in the blank 0ef6bf055076030_5	fill in the blank 0ef6bf055076030_6
Total variable cost		$fill in the blank 0ef6bf055076030_7

Fixed costs:
Maintenance		$fill in the blank 0ef6bf055076030_8
Indirect labor		fill in the blank 0ef6bf055076030_9
Rent		fill in the blank 0ef6bf055076030_10
Total fixed costs		$fill in the blank 0ef6bf055076030_11
Total overhead costs		$fill in the blank 0ef6bf055076030_12

2. Prepare an overhead budget that reflects production that is 15% higher than expected and for production that is 15% lower than expected.

Activity Level
	Rate per Hour	fill in the blank 4e970707000bfc3_1 Hours	fill in the blank 4e970707000bfc3_2 Hours
Variable costs:
Maintenance	$fill in the blank 4e970707000bfc3_3	$ fill in the blank 4e970707000bfc3_4	$ fill in the blank 4e970707000bfc3_5
Power	fill in the blank 4e970707000bfc3_6	fill in the blank 4e970707000bfc3_7	fill in the blank 4e970707000bfc3_8
Indirect labor	fill in the blank 4e970707000bfc3_9	fill in the blank 4e970707000bfc3_10	fill in the blank 4e970707000bfc3_11
Total variable costs		$fill in the blank 4e970707000bfc3_12	$fill in the blank 4e970707000bfc3_13
Fixed costs:
Maintenance		$ fill in the blank 4e970707000bfc3_14	$ fill in the blank 4e970707000bfc3_15
Indirect labor		fill in the blank 4e970707000bfc3_16	fill in the blank 4e970707000bfc3_17
Rent		fill in the blank 4e970707000bfc3_18	fill in the blank 4e970707000bfc3_19
Total fixed costs		$fill in the blank 4e970707000bfc3_20	$fill in the blank 4e970707000bfc3_21
Total overhead costs		$fill in the blank 4e970707000bfc3_22	$fill in the blank 4e970707000bfc3_23

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