Zhou, Inc.is planning its overhead costs for an upcoming period when 85,000 machine hours are expected to be worked.Activity may drop as low as 78,000 hours if some overdue equipment maintenance procedures are performed; on the other hand, activity could jump to 94,000 hours if one of Zhou's major competitors likely goes bankrupt.A ﬂexible overhead budget would best be based on:

Question

Quizplus · Accepted Answer

A flexible overhead budget should take into account the range of expected activity levels. In this case, the expected range of machine hours is from 78,000 to 94,000 hours. Therefore the best choice(s) would be a flexible overhead budget based on 78,000 hours, 85,000 hours and 94,000 hours.

Zhou, IncIs Planning Its Overhead Costs for an Upcoming Period When