Flexible Overhead Budget Wiki Wiki Company has determined that the variable overhead rate is $4.50 per direct labor hour in the Fabrication Department. The normal production capacity for the Fabrication Department is 10,000 hours for the month. Fixed costs are budgeted at $60,000 for the month. a.  Prepare a monthly factory overhead flexible budget for 9,000, 10,000, and 11,000 hours of production. Enter all amounts as positive numbers. Wiki Wiki Company Monthly Factory Overhead Cost Budget-Fabrication Department   Direct labor hours 9,000 10,000 11,000 Variable factory overhead cost $fill in the blank 06d288060fcc037_1 $fill in the blank 06d288060fcc037_2 $fill in the blank 06d288060fcc037_3 Fixed factory overhead cost fill in the blank 06d288060fcc037_4 fill in the blank 06d288060fcc037_5 fill in the blank 06d288060fcc037_6 Total factory overhead cost $fill in the blank 06d288060fcc037_7 $fill in the blank 06d288060fcc037_8 $fill in the blank 06d288060fcc037_9 b.  How much overhead would be applied to production if 9,000 hours were used in the department during the month? If required, round your calculations to two decimal places and your final answer to the nearest dollar. $fill in the blank b68973f7703b025_1

Managerial Accounting
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ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:Carl Warren, Ph.d. Cma William B. Tayler
Chapter9: Evaluating Variances From Standard Costs
Section: Chapter Questions
Problem 14E
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Flexible Overhead Budget

Wiki Wiki Company has determined that the variable overhead rate is $4.50 per direct labor hour in the Fabrication Department. The normal production capacity for the Fabrication Department is 10,000 hours for the month. Fixed costs are budgeted at $60,000 for the month.

a.  Prepare a monthly factory overhead flexible budget for 9,000, 10,000, and 11,000 hours of production. Enter all amounts as positive numbers.

Wiki Wiki Company
Monthly Factory Overhead Cost Budget-Fabrication Department
 
Direct labor hours 9,000 10,000 11,000
Variable factory overhead cost $fill in the blank 06d288060fcc037_1 $fill in the blank 06d288060fcc037_2 $fill in the blank 06d288060fcc037_3
Fixed factory overhead cost fill in the blank 06d288060fcc037_4 fill in the blank 06d288060fcc037_5 fill in the blank 06d288060fcc037_6
Total factory overhead cost $fill in the blank 06d288060fcc037_7 $fill in the blank 06d288060fcc037_8 $fill in the blank 06d288060fcc037_9

b.  How much overhead would be applied to production if 9,000 hours were used in the department during the month? If required, round your calculations to two decimal places and your final answer to the nearest dollar.
$fill in the blank b68973f7703b025_1

Expert Solution
Step 1

A flexible budget is a budget that includes all the flexibility and change in the output. In comparison to the Static budget, the flexible budget is more useful. It includes Fixed and variable both.

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