Question - Pollitt Potato Packers has a flexible budget for manufacturing overhead that is based on direct labour hours(DLH). The following overhead costs appear on the flexible budget at the 200,000-hour level of activity:
Variable Overhead Costs (total):
Packing Supplies $120,000
Indirect Labour $180,000
Fixed Overhead Costs (total):
Utilities $100,000
Insurance $40,000
Rent $20,000
a) At an activity level of 180,000 direct labour hours, what amount would the flexible budget estimate for indirect labour cost?
b) What amount would the flexible budget estimate for total variable overhead cost per direct labour hour?
c) At an activity level of 180,000 direct labour hours, what amount would the flexible budget estimate for total budgeted fixed costs?
d) At an activity level of 160,000 direct labour hours, what amount would the flexible budget estimate for the utilities?