Manufacturing Overhead Budget: Calculate Variable and Fixed

School: Seneca College - Course: HRM 822 - Subject: Accounting

budgeted direct labour-hours: Quarter 1Quarter 2Quarter 3Quarter 4 Budgeted direct labour hours8,0008,2008,5007,800 The company's variable manufacturing overhead rate is $3.25 per direct labour-hour and the company's fixed manufacturing overhead per quarter is as follows: Rent $19,000 Depreciation $16,000 Maintenance $13,000 Prepare the manufacturing overhead budget for the year, showing quarterly data. (15 marks) Quarter 1Quarter 2Quarter 3 Budgeted direct labour hours8,0008,2008,500 Variable manufacturing overhead rate per hour$3.25$3.25$3.25 Total variable manufacturing overhead$26,000$26,650$27,625 Fixed Manufacturing Overhead Rent19,00019,00019,000 Depreciation16,00016,00016,000 Maintenance13,00013,00013,000 Total Fixed Manufacturing Overhead48,00048,00048,000 Total manufacturing Overhead$74,000$74,650$75,625

Quarter 4Year 7,80032,500 $3.25$3.25 $25,350$105,625 19,00076,000 16,00064,000 13,00052,000 48,000192,000 $73,350$297,625

Question 2 The budgeted unit sales of Squidly Company for the upcoming fiscal year are as follows: Quarter 1Quarter 2Quarter 3Quarter 4 Budgeted unit sales15,00016,00014,00013,000 The company's variable selling and administration expense per unit is $2.50.Fixed selling and administrative expenses include the following: Advertising expense - $8,000 per quarter Executive salaries - $35,000 per quarter Depreciation - $20,000 per quarter Insurance -$2,500 per quarter Utilities -$2,000 per quarter Prepare a selling and administrative expenses budget by quarters and totalfor the upcoming Qtr 1Qtr 2Qtr 3 Budgeted unit sales15,00016,00014,000 Variable cost per unit$2.50$2.50$2.50 Total variable selling and admin expenses$37,500$40,000$35,000 Fixed selling and admin expenses Advertising expense8,0008,0008,000 Executive salaries35,00035,00035,000 Depreciation20,00020,00020,000 Insurance2,5002,5002,500 Utilities2,0002,0002,000 Total fixed selling and admin expenses67,50067,50067,500 Total Selling and Admin Expenses$105,000 $107,500$102,500