Question Completion:
The manufacturing overhead in the flexible budget for March would be closest to:
A. $371,650
B. $371,281
C. $373,630
D. $374,300
Where the fixed overhead is $45,700 and the actual direct labor hours is 6,150 instead of 6,300 (at a predetermined overhead rate of $53 per DLH).
Answer:
The manufacturing overhead in the flexible budget for January would be closest to:
A. $371,650
Explanation:
a) Data and Calculations:
Fixed overhead = $45,700
Estimated direct labor hours = 6,300
Actual direct labor hours = 6,150
Predetermined overhead rate = $53 per DLH
In the static budget, the manufacturing overhead will be equal to:
= $45,700 + ($53 x 6,300)
= $379,600
But the flexible budget manufacturing overhead will be based on the actual hours of direct labor, thus:
= $45,700 + ($53 x 6,150)
= $371,650
