Question

A department has budgeted monthly manufacturing overhead cost of $510000 plus $3 per direct labor hour. If a flexible budget report reflects $984000 for total budgeted manufacturing cost for the month, the actual level of activity achieved during the month was__________.

Answer 1

Answer:

Direct labor hour will be 158000

Explanation:

We have given manufacturing overhead cost = $510000

An total budgeted manufacturing cost = $984000

So balance variable cost = $984000 - $51000 = $474000

It is given that $3 per direct labor hour

We have to fond the number of labor hours

So number of direct labor hours will be $=\frac{474000}{3}=158000$

So dire t labor hour will be 158000