Question

Each unit requires 4 hours of direct labor at a rate of $13 per hour. Variable factory overhead is budgeted to be 70% of direct labor cost, and fixed factory overhead is $179,000 per month. Prepare a factory overhead budget for August.

Answer 1

Some numbers are missing, so I looked for similar questions and found the following:

Miami solar budgets production of 5,300 solar panels for August. Each unit requires 4 hours of direct labor at a rate of $13 per hour. Variable factory overhead is budgeted to be 70% of direct labor cost, and fixed factory overhead is $179,000 per month.

direct labor costs per unit = $13 x 4 = $52

variable overhead costs per unit = $52 x 70% = $36.40

Miami Solar

Factory Overhead Budget

For the month of August, 202x

Budgeted production units 5,300 units

Variable overhead per unit $36.40

Budgeted variable overhead $192,920

Budgeted fixed overhead $179,000

Budgeted total overhead $371,920