Overhead Budget Overhead BudgetJohnston Company cleans and applies powder coat paint to metal items on a job-order basis. Johnston has budgeted the following amounts for various overhead categories in the coming year.Supplies$225,000Gas60,000Indirect labor178,000Supervision76,500Depreciation on equipment53,000Depreciation on the buliding50,000Rental of special equipment10,500Electricity (for lighting, heating, and air conditioning)27,100Telephone4,100Landscaping service1,900Other overhead55,000In the coming year, Johnston expects to powder coat 170,000 units. Each unit takes 1.3 direct labor hours. Johnston has found that supplies and gas (used to run the drying ovens-all units pass through the drying ovens after powder coat paint isapplied) tend to vary with the number of units produced. All other overhead categories are considered to be fixed.Required:1. Calculate the number of direct labor hours Johnston must budget for the coming year. Calculate the variable overhead rate. Calculate the total fixed overhead for the coming year. When required, round your answers to the nearest cent and usethe rounded answers in subsequent requirements.Direct labor hoursVariable overhead rateper direct labor hourTotal fixed overhead 2. Prepare an overhead budget for Johnston for the coming year. Show the total variable overhead, total fixed overhead, and total overhead. When required, round your answers to the nearest cent.Johnston CompanyOverhead BudgetFor the Coming YearBudgeted direct labor hoursVariable overhead rateBudgeted variable overheadBudgeted fixed overheadTotal budgeted overheadCalculate the fixed overhead rate and the total overhead rate. If required, round your answers to the nearest cent.Fixed overhead rateper direct labor hourTotal overhead rateper direct labor hour3. What if Johnston had expected to make 168,000 units next year? Assume that the variable overhead per unit does not change and the total fixed overhead amounts do not change. Calculate the new budgeted direct labor hours.Prepare a new overhead budget. If required, round your answers to the nearest cent.Johnston CompanyNew Overhead BudgetFor the Coming YearBudgeted direct labor hoursVariable overhead rateBudgeted variable overheadBudgeted fixed overheadTotal budgeted overheadCalculate the fixed overhead rate and the total overhead rate. If required, round your answers to the nearest cent.Fixed overhead rateper direct labor hourTotal overhead rateper direct labor hour

GIVEN Johnston Company deans and applies powder coat paint to metal items on a job-order basis.

Johnston Company cleans and applies powder coat paint to metal items on a job-order basis. Johnston has budgeted the following amounts for various overhead categories in the coming year. Supplies $225,000 Gas 60,000 Indirect labor 178,000 Supervision 76,500 Depreciation on equipment 53,000 Depreciation on the buliding 50,000 Rental of special equipment 10,500 Electricity (for lighting, heating, and air conditioning) 27,100 Telephone 4,100 Landscaping service 1,900 Other overhead 55,000 In the coming year, Johnston expects to powder coat 170,000 units. Each unit takes 1.3 direct labor hours. Johnston has found that supplies and gas (used to run the drying ovens-all units pass through the drying ovens after powder coat paint is applied) tend to vary with the number of units produced. All other overhead categories are considered to be fixed.

Johnston Company cleans and applies powder coat paint to metal items on a job-order basis. Johnston has budgeted the following amounts for various overhead categories in the coming year. Supplies $225,000 Gas 60,000 Indirect labor 178,000 Supervision 76,500 Depreciation on equipment 53,000 Depreciation on the buliding 50,000 Rental of special equipment 10,500 Electricity (for lighting, heating, and air conditioning) 27,100 Telephone 4,100 Landscaping service 1,900 Other overhead 55,000 In the coming year, Johnston expects to powder coat 170,000 units. Each unit takes 1.3 direct labor hours. Johnston has found that supplies and gas (used to run the drying ovens-all units pass through the drying ovens after powder coat paint is applied) tend to vary with the number of units produced. All other overhead categories are considered to be fixed.

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter8: Budgeting For Planning And Control

Section: Chapter Questions

Problem 5CE: Johnston Company cleans and applies powder coat paint to metal items on a job-order basis. Johnston...

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Johnston Company cleans and applies powder coat paint to metal items on a job-order basis. Johnston has budgeted the following amounts for various overhead categories in the coming year. In the coming year, Johnston expects to powder coat 120,000 units. Each unit takes 1.3 direct labor hours. Johnston has found that supplies and gas (used to run the drying ovensall units pass through the drying ovens after powder coat paint is applied) tend to vary with the number of units produced. All other overhead categories are considered to be fixed. (Round all overhead rates to the nearest cent.) Required: 1. Calculate the number of direct labor hours Johnston must budget for the coming year. Calculate the variable overhead rate. Calculate the total fixed overhead for the coming year. 2. Prepare an overhead budget for Johnston for the coming year. Show the total variable overhead, total fixed overhead, and total overhead. Calculate the fixed overhead rate and the total overhead rate (rounded to the nearest cent). 3. What if Johnston had expected to make 118,000 units next year? Assume that the variable overhead per unit does not change and the total fixed overhead amounts do not change. Calculate the new budgeted direct labor hours and prepare a new overhead budget. Calculate the fixed overhead rate and the total overhead rate (rounded to the nearest cent).
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3. Question Content Area Overhead Budget Johnston Company cleans and applies powder coat paint to metal items on a job-order basis. Johnston has budgeted the following amounts for various overhead categories in the coming year. Supplies $225,000 Gas 60,000 Indirect labor 173,000 Supervision 78,000 Depreciation on equipment 52,000 Depreciation on the buliding 47,000 Rental of special equipment 14,500 Electricity (for lighting, heating, and air conditioning) 28,800 Telephone 4,400 Landscaping service 1,400 Other overhead 51,000 In the coming year, Johnston expects to powder coat 120,000 units. Each unit takes 1.3 direct labor hours. Johnston has found that supplies and gas (used to run the drying ovens—all units pass through the drying ovens after powder coat paint is applied) tend to vary with the number of units produced. All other overhead categories are considered to be fixed. Required: Question Content Area 1. Calculate the number of direct labor…
A manufacturer uses machine hours to assign overhead costs to products. Budgeted information for the next year follows. Budgeted factory overhead costs Budgeted machine hours Compute the plantwide overhead rate for the next year based on machine hours. Plantwide overhead rate $431,200 5,600 per MH
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Flexible Overhead Budget Leno Manufacturing Company prepared the following factory overhead cost budget for the Press Department for October of the current year, during which it expected to require 20,000 hours of productive capacity in the department: Variable overhead costs: Indirect factory labor $180,000 Power and light 12,000 Indirect materials 64,000 Total variable overhead cost $256,000 Fixed overhead costs: Supervisory salaries $ 80,000 Depreciation of plant and equipment 50,000 Insurance and property taxes 32,000 Total fixed overhead cost 162,000 Total factory overhead cost $418,000 Assuming that the estimated costs for November are the same as for October, prepare a flexible factory overhead cost budget for the Press Department for November for 18,000, 20,000, and 22,000 hours of production. Enter all amounts as positive numbers. Round your interim computations to the nearest cent, if…