MANAGERIAL ACCOUNTING
16th Edition
ISBN: 9781260901320
Author: Garrison
Publisher: MCGRAW-HILL HIGHER EDUCATION
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EXERCISE 8-15 Direct Labor and Manufacturing Overhead Budgets [ LO8-5, Q LO8-6]
The Production Department of Hruska Corporation has submitted the following forecast of units to be produced by quarter for
the upcoming fiscal year:
1st Quarter 2nd Quarter 3rd Quarter 4th Quarter
Units to be produced
12,000
10,000
13,000
14,000
Each unit regquires 0.2 direct labor-hours and direct laborers are paid $12.00 per hour.
In addition, the variable manufacturing overhead rate is $1.75 per direct labor-hour. The fixed manufacturing overhead is $86,000
per quarter. The only noncash element of manufacturing overhead is depreciation, which is $23,000 per quarter.
Required:
1. Prepare the company's direct labor budget for the upcoming fiscal year, assuming that the direct labor workforce is adjusted
each quarter to match the number of hours required to produce the forecasted number of units produced.
Question 7
Howard Bannister Company budgets the following per-unit costs for the upcoming year:
Direct Material
Direct Labor
Variable Selling Expenses
Sales commission
$32.54
$21.24
$15.70
$20.10
Howard budgets producing 1,017 units and having 27,370 of total variable overhead, 49,540
of total fixed overhead, and 30,387 of total fixed S&A costs for the year. Howard allocates
overhead based on units produced.
What is the per-unit cost of inventory under variable costing (i.e., assuming budgets are
correct, how much will be the total amount debited to WIP if Howard produces one additional
unit)? Round your answer to two decimal places (e.g., 192.37).
Question 1
Shiashi Ltd is preparing its manufacturing overhead budget for 2024. Relevant data consist of the
following:
- Units to be produced (by quarters): 20,000, 24,000, 34,000 and 36,000.
Direct labour: Time is 1.5 hours per unit.
Variable overhead costs per direct labour hour: Indirect materials GH¢1.40;
indirect labour GH 2.40 and maintenance $1.50.
Fixed overhead costs per quarter: Supervisory salaries GH 55,000; depreciation
GH 27,000 and maintenance GH¢25,000.
a) You are required to prepare the manufacturing overhead budget for the year, showing
quarterly data.
b) What does an organisation stand to gain by preparing annual budgets for its operations?
c) Describe the budgeting process of any business entity that you are familiar with.
Chapter 8 Solutions
MANAGERIAL ACCOUNTING
Ch. 8 - Prob. 1QCh. 8 - Prob. 2QCh. 8 - Prob. 3QCh. 8 - 8-4 What is a master budget? Briefly describe its...Ch. 8 - 8—5 Why is the sales forecast the starting point...Ch. 8 - Prob. 6QCh. 8 - 8-7 Why is it a good idea to create a ‘"Budgeting...Ch. 8 - 8-8 What is a self-imposed budget? What are the...Ch. 8 - Prob. 9QCh. 8 - Prob. 10Q
Ch. 8 -
The Excel worksheet form that appears below is to...Ch. 8 - Prob. 2AECh. 8 - Prob. 1F15Ch. 8 - Prob. 2F15Ch. 8 - Prob. 3F15Ch. 8 - Prob. 4F15Ch. 8 - Morganton Company makes one product and it...Ch. 8 - Morganton Company makes one product and it...Ch. 8 - Morganton Company makes one product and it...Ch. 8 - Morganton Company makes one product and it...Ch. 8 - Morganton Company makes one product and it...Ch. 8 - Morganton Company makes one product and it...Ch. 8 - Prob. 11F15Ch. 8 - Prob. 12F15Ch. 8 - Prob. 13F15Ch. 8 - Prob. 14F15Ch. 8 - Prob. 15F15Ch. 8 - EXERCISE 8-1 Schedule of Expected Cash Collections...Ch. 8 - Prob. 2ECh. 8 - EXERCISE 8-3 Direct Materials Budget LOW Three...Ch. 8 -
EXERCISE 8-4 Direct Labor Budget...Ch. 8 -
EXERCISE 8-5 Manufacturing Overhead Budget...Ch. 8 -
...Ch. 8 -
The company's beginning cash balance for the...Ch. 8 - EXERCISE 8-8 Budgeted Income Statement LO8-9 Gig...Ch. 8 - EXERCISE 8-9 Budgeted Balance Sheet LO8-10 The...Ch. 8 -
EXERCISE 8-10 Production and Direct Materials...Ch. 8 - EXERCISE 8-11 Cash Budget Analysis LOB-8 A cash...Ch. 8 - Prob. 12ECh. 8 - Prob. 13ECh. 8 -
EXERCISE 8-14 Sales and Production Budgets LO8-2,...Ch. 8 - EXERCISE 8-15 Direct Labor and Manufacturing...Ch. 8 - EXERCISE 8-16 Direct Materials and Direct Labor...Ch. 8 - Prob. 17ECh. 8 - Prob. 18ECh. 8 - PROBLEM 8-19 Cash Budget: Income Statement:...Ch. 8 -
PROBLEM 8-20 Cash Budget; Income Statement;...Ch. 8 - Prob. 21PCh. 8 -
PROBLEM 8-22 Evaluating a Company’s Budget...Ch. 8 - PROBLEM 8—23 schedule or Expected cash...Ch. 8 - PROBLEM 8-24 Cash Budget with Supporting Schedules...Ch. 8 - PROBLEM B-25 Cash Budget with Supporting...Ch. 8 - PROBLEM 8-26 Behavioral Aspects of Budgeting:...Ch. 8 - (
$
55,000
$ 55, 000
...Ch. 8 -
PROBLEM 8-28 Cash Budget with Supporting...Ch. 8 - PROBLEM 8-29 Completing a Master Budget LO8-2,...Ch. 8 - PROBLEM 8-30 Integration of the Sales, Production,...Ch. 8 - Prob. 31PCh. 8 -
CASE 8-32 Evaluatinga Company’s Budget Procedures...Ch. 8 - CASE 8-33 Master Budget with Supporting Schedules...
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