Question

Question was provided via image upload.

Explanation:

Calculate direct labor hours needed

Using the Direct Labor Hours and Direct Labor Budget knowledge points:
We calculate the direct labor hours needed for each month by multiplying the units to produce by the direct labor hours required per unit (\(0.3\) hour).

• April:

$$ 510 \text{ units} \times 0.3 \text{ hour/unit} = 153 \text{ hours} $$

• May:

$$ 640 \text{ units} \times 0.3 \text{ hour/unit} = 192 \text{ hours} $$

• June:

$$ 610 \text{ units} \times 0.3 \text{ hour/unit} = 183 \text{ hours} $$

Calculate budgeted variable overhead

Using the Variable Overhead Rate and Factory Overhead Budget knowledge points:
We calculate the variable overhead by multiplying the direct labor hours needed by the variable overhead rate (\(\$27\) per direct labor hour).

• April:

$$ 153 \text{ hours} \times \$27/\text{hour} = \$4,131 $$

• May:

$$ 192 \text{ hours} \times \$27/\text{hour} = \$5,184 $$

• June:

$$ 183 \text{ hours} \times \$27/\text{hour} = \$4,941 $$

Apply budgeted fixed overhead

Using the Fixed Overhead Allocation and Factory Overhead Budget knowledge points:
The budgeted fixed overhead is a constant amount of \(\$8,700\) per month.

• April: \(\$8,700\)
• May: \(\$8,700\)
• June: \(\$8,700\)

Compute budgeted total factory overhead

Using the Factory Overhead Budget knowledge point:
We sum the budgeted variable overhead and budgeted fixed overhead for each month to find the total budgeted factory overhead.

• April:

$$ \$4,131 + \$8,700 = \$12,831 $$

• May:

$$ \$5,184 + \$8,700 = \$13,884 $$

• June:

$$ \$4,941 + \$8,700 = \$13,641 $$

Answer:

Item	April	May	June
Budgeted variable overhead	\$4,131	\$5,184	\$4,941
Budgeted fixed overhead	\$8,700	\$8,700	\$8,700
Budgeted total factory overhead	\$12,831	\$13,884	\$13,641