BA225 Managerial Accounting: Problem 1 - Frizell Company is preparing its manufacturing

BA225 Managerial Accounting
Module 5 Exercises

Problem 1
Frizell Company is preparing its manufacturing overhead budget for 2011. Relevant data consist of the following.
· Units to be produced (by quarters): 10,000, 12,000, 14,000, and 16,000
· Direct labor: Time is 1.5 hours per unit
· Variable overhead costs per direct labor hour: Indirect materials $0.70; indirect labor $1.20; and maintenance $0.50
· Fixed overhead costs per quarter: Supervisory salaries $35,000; depreciation $16,000; and maintenance $12,000

Prepare the manufacturing overhead budget for the year, showing quarterly data.
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