Ceiling Fans by Ike's overhead budget for 2009 was as follows: 600,000 units were produced in 2009.
Direct labor cost is $18,000,000.
For both 2009 and 2010, each unit required 3 direct labor hours at $10 per hour.
In 2010, property taxes, insurance, and depreciation are expected to stay at 2009 levels.
Utilities costs vary proportionally with units produced.
Factory supervision increases by increments of $30,000 for every 200,000 increase in direct labor hours.
The 2010 expected production is 1,200,000 units.
What will be the value for factory supervision in the 2010 overhead budget?
A) $570,000
B) $270,000
C) $450,000
D) $400,000

Question

Ceiling Fans by Ike's overhead budget for 2009 was as follows:  600,000 units were produced in 2009.
Direct labor cost is $18,000,000.
For both 2009 and 2010, each unit required 3 direct labor hours at $10 per hour.
In 2010, property taxes, insurance, and depreciation are expected to stay at 2009 levels.
Utilities costs vary proportionally with units produced.
Factory supervision increases by increments of $30,000 for every 200,000 increase in direct labor hours.
The 2010 expected production is 1,200,000 units.
What will be the value for factory supervision in the 2010 overhead budget?
A) $570,000 
B) $270,000 
C) $450,000 
D) $400,000

Quizplus · Accepted Answer

The Answer of Ceiling Fans by Ike's overhead budget for 2009 was as follows:  600,000 units were produced in 2009.
Direct labor cost is $18,000,000.
For both 2009 and 2010, each unit required 3 direct labor hours at $10 per hour.
In 2010, property taxes, insurance, and depreciation are expected to stay at 2009 levels.
Utilities costs vary proportionally with units produced.
Factory supervision increases by increments of $30,000 for every 200,000 increase in direct labor hours.
The 2010 expected production is 1,200,000 units.
What will be the value for factory supervision in the 2010 overhead budget?
A) $570,000 
B) $270,000 
C) $450,000 
D) $400,000

Ceiling Fans by Ike's Overhead Budget for 2009 Was as Follows