Question

Exercise 22-11

Atlanta Company is preparing its manufacturing overhead budget for 2020. Relevant data consist of the following.

Units to be produced (by quarters): 10,100, 12,100, 14,100, 16,100.

Direct labor: Time is 1.5 hours per unit.

Variable overhead costs per direct labor hour: indirect materials $0.70; indirect labor $1.20; and maintenance $0.50.

Fixed overhead costs per quarter: supervisory salaries $36,000; depreciation $17,000; and maintenance $13,000.

Prepare the manufacturing overhead budget for the year, showing quarterly data. (Round overhead rate to 2 decimal places, e.g. 1.25. List variable expenses before fixed expense.)

ATLANTA COMPANY Manufacturing Overhead Budget For the Quarter Ending December 31, 2020For the Year Ending December 31, 2020December 31, 2020
	Quarter
		1		2		3		4		Year
Total Manufacturing OverheadTotal FixedFixed CostsIndirect MaterialsDirect Materials Per UnitDirect Materials PurchasesDepreciationDesired Ending MaterialsIndirect LaborMaintenanceUnits to be ProducedSupervisory SalariesTotal Materials RequiredVariable CostsTotal Pounds Needed for ProductionTotal VariableBeginning Direct Materials
Indirect Materials    Variable Costs    Maintenance    Total Manufacturing Overhead    Indirect Labor    Beginning Direct Materials    Supervisory Salaries    Total Fixed    Total Materials Required    Units to be Produced    Total Pounds Needed for Production    Total Variable    Depreciation    Desired Ending Materials    Direct Materials Per Unit    Direct Materials Purchases    Fixed Costs		$		$		$		$		$
Maintenance    Depreciation    Total Materials Required    Direct Materials Purchases    Indirect Materials    Variable Costs    Direct Materials Per Unit    Total Variable    Supervisory Salaries    Units to be Produced    Fixed Costs    Total Manufacturing Overhead    Total Pounds Needed for Production    Total Fixed    Indirect Labor    Beginning Direct Materials    Desired Ending Materials
		$		$		$		$		$
Direct labor hours
Manufacturing overhead rate per direct labor hour										$

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Answer 1

Solution:

Q T 4 5 6 Computation of Direct Labor Hours 7 Quarter 4 Year 1 2 3 Units to be produced 52400 14100 10100 12100 16100 Direct Labor Hours per unit 9 1.5 1.5 1,5 1.5 1,5 Total Direct Labor Hours 21150 24150 18150 78600 10 15150 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 ло Sheet284 Sheet285 Sheet286 Sheet287 She RC

G K 1 2 4 5 Atlanta Company Manufacturing Overhead Budget For the year ending December 31, 2020 6 7 4. 1 2 3 Year Variable Overhead costs: Indirect Material ($0.70*Direct Labor hours) Indirect Labor ($1.20*Direct Labor hours) Maintenance ($0.50*Direct Labor hours) Total variable overhead Cost $14,805 $25,380 $10,575 $50,760 $10,605 $18,180 $7,575 $36,360 $12,705 $21,780 $9,075 $43,560 $16,905 $28,980 $12,075 $57,960 $55,020 $94,320 $39,300 $188,640 10 11 12 13 14 Fixed overhead costs: 15 Supervisory Salaries Depreciation Maintenance Total Fixed overhead Cost Total Manufacturing Overhead $36,000 $17,000 $13,000 $66,000 $116,760 $36,000 $17,000 $13,000 $66,000 $123,960 $144,000 $68,000 $52,000 $264,000 $452,640 $36,000 $17,000 $13,000 $66,000 $102,360 16 $36,000 $17,000 17 $13,000 $66,000 $109,560 18 19 20 21 15150 18150 24150 22 Direct LaborHours 21150 78600 23 $5.76 Manufacturing Overhead rate per labor hour 24 (Total Manufacturing Overhead/ Total Direct Labor Hours) 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 Sheet284 Sheet285 Sheet286 Sheet287 She II