J&J Materials and Construction Corporation produces mulch and distributes the product by using dump trucks. The company uses budgeted fleet hours to allocate variable manufacturing overhead. The following information pertains to the company's manufacturing overhead data:

What is the flexible-budget amount for variable manufacturing overhead? (Round intermediary calculations two decimal places and your final answer to the nearest whole dollar.)
A) $81,801
B) $94,392
C) $86,184
D) $89,592

Question

J&J Materials and Construction Corporation produces mulch and distributes the product by using dump trucks. The company uses budgeted fleet hours to allocate variable manufacturing overhead. The following information pertains to the company's manufacturing overhead data:

What is the flexible-budget amount for variable manufacturing overhead? (Round intermediary calculations two decimal places and your final answer to the nearest whole dollar.)
A) $81,801 
B) $94,392 
C) $86,184 
D) $89,592

Quizplus · Accepted Answer

Budgeted fleet hours per unit = 621 ÷ 690 = 0.9
Budgeted fleet hours allowed for 630 truckloads = 630 × 0.9 = 567
Budgeted variable overhead rate per machine hour = $94,392 ÷ 621 = $152.00
Flexible-budget amount = 567 × $152.00 = $86,184

J&J Materials and Construction Corporation Produces Mulch and Distributes the Product