Question

The direct labor budget of Yuvwell Corporation for the upcoming fiscal year contains the following details concerning budgeted direct labor-hours:

1st Quarter 2nd Quarter 3rd Quarter 4th Quarter
Budgeted direct labor-hours 8,800 8,600 8,900 8,300
The company's variable manufacturing overhead rate is $3.00 per direct labor-hour and the company's fixed manufacturing overhead is $56,000 per quarter. The only noncash item included in fixed manufacturing overhead is depreciation, which is $14,000 per quarter.

(1) Complete the company's manufacturing overhead budget for the upcoming fiscal year.
(2) Compute the company's manufacturing overhead rate (including both variable and fixed manufacturing overhead) for the upcoming fiscal year.

Answer 1

To complete the manufacturing overhead budget for Yuvwell Corporation, calculate the total manufacturing overhead for each quarter by adding the fixed and variable manufacturing overhead costs. The total manufacturing overhead for each quarter is as follows: 1st quarter - $96,400, 2nd quarter - $95,800, 3rd quarter - $96,700, 4th quarter - $94,900.

Step-by-step explanation:

To complete the company's manufacturing overhead budget for the upcoming fiscal year, we need to calculate the total manufacturing overhead for each quarter. The total manufacturing overhead for each quarter is the sum of the fixed manufacturing overhead and the variable manufacturing overhead. Here are the calculations:

1. For the 1st quarter: Variable manufacturing overhead = Budgeted direct labor-hours x Variable manufacturing overhead rate = 8,800 x $3.00 = $26,400. Fixed manufacturing overhead = $56,000 + $14,000 (depreciation) = $70,000. Total manufacturing overhead = Variable manufacturing overhead + Fixed manufacturing overhead = $26,400 + $70,000 = $96,400.
2. For the 2nd quarter: Variable manufacturing overhead = 8,600 x $3.00 = $25,800. Fixed manufacturing overhead = $56,000 + $14,000 = $70,000. Total manufacturing overhead = $25,800 + $70,000 = $95,800.
3. For the 3rd quarter: Variable manufacturing overhead = 8,900 x $3.00 = $26,700. Fixed manufacturing overhead = $56,000 + $14,000 = $70,000. Total manufacturing overhead = $26,700 + $70,000 = $96,700.
4. For the 4th quarter: Variable manufacturing overhead = 8,300 x $3.00 = $24,900. Fixed manufacturing overhead = $56,000 + $14,000 = $70,000. Total manufacturing overhead = $24,900 + $70,000 = $94,900.

Answer 2

Instructions are listed below.

Step-by-step explanation:

Giving the following information:

1st Quarter 2nd Quarter 3rd Quarter 4th Quarter

Budgeted direct labor-hours 8,800 8,600 8,900 8,300

Total units= 34,600 units

The company's variable manufacturing overhead rate is $3.00 per direct labor-hour and the company's fixed manufacturing overhead is $56,000 per quarter. The only noncash item included in fixed manufacturing overhead is depreciation, which is $14,000 per quarter.

1) Variable overhead= 34,600*3= $103,800

Fixed overhead= (56,000-14,000)*4= $168,000

Total overhead= $271,800

2) Estimated manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base

Estimated manufacturing overhead rate= 271,800/34,600= $7.85 per direct labor hour.