Thome Company uses a flexible budget for manufacturing overhead based on direct labor hours. Variable manufacturing overhead costs per direct labor hour are as follows.
| Indirect labor |
|
$1.50 |
| Indirect materials |
|
0.90 |
| Utilities |
|
0.40
|
Fixed overhead costs per month are: Supervision $4,498, Depreciation $1,423, and Property Taxes $692. The company believes it will normally operate in a range of 7,800–13,800 direct labor hours per month.
Assume that in July 2014, Thome Company incurs the following manufacturing overhead costs.
|
Variable Costs
|
|
Fixed Costs
|
| Indirect labor |
|
$17,442 |
|
Supervision |
|
$4,498 |
| Indirect materials |
|
10,450 |
|
Depreciation |
|
1,423 |
| Utilities |
|
4,251 |
|
Property taxes |
|
692 |
Prepare a flexible budget performance report, assuming that the company worked 11,800 direct labor hours during the month.
Thome Company uses a flexible budget for manufacturing overhead based on direct labor hours. Variable manufacturing overhead costs per direct labor hour are as follows.
| Indirect labor |
|
$1.50 |
| Indirect materials |
|
0.90 |
| Utilities |
|
0.40
|
Fixed overhead costs per month are: Supervision $4,498, Depreciation $1,423, and Property Taxes $692. The company believes it will normally operate in a range of 7,800-13,800 direct labor hours per month.
Assume that in July 2014, Thome Company incurs the following manufacturing overhead costs.
|
Variable Costs
|
|
Fixed Costs
|
| Indirect labor |
|
$17,442 |
|
Supervision |
|
$4,498 |
| Indirect materials |
|
10,450 |
|
Depreciation |
|
1,423 |
| Utilities |
|
4,251 |
|
Property taxes |
|
692 |
Prepare a flexible budget performance report, assuming that the company worked 11,800 direct labor hours during the month.