Problem:
Emerald Corporaiton's overhead budget for 2013 was as follows:
| Factory Supervision |
$450,000 |
| Utilities costs |
250,000 |
| Insurance |
30,000 |
| Property taxes |
25,000 |
| Deprectiation |
125,000 |
| Total |
$880,000 |
750,000 units were produced in 2013. Direct labor cost is $42,000,000. For both 2013 and 2014, each unit required 4 direct labor hours at $14 per hour. In 2014, property taxes, insurance, and depreciation are expected to stay at 2013 levels. Utilities costs vary proprotionally with units produced. Factory supervision increases by increments of $45,000 for every 300,000 increase in direct labor hours. The 2014 expected production is 1,200,000 units.
Required:
Question: What will be the value for factory supervision of Emeral in the 2014 budget?
Note: Provide support for your rationale.