Willard Company anticipates that its fixed manufacturing overhead costs will be $50,000 during the next period.Its variable manufacturing overhead is expected to be $8 per unit produced.
Required:
(a)What amount of overhead should be budgeted if the production budget shows that 40,000 units are to be produced?
(b)What amount of overhead should be budgeted if the production budget shows that 50,000 units are to be produced?
(c)Compute the total overhead cost per unit for requirements 1 and 2.

Question

Quizplus · Accepted Answer

Feedback: (a)Budgeted overhead if 40,000 units are produced: $50,000 + ($8 x 40,000)= $370,000
(b)Budgeted overhead if 50,000 units are produced: $50,000 + ($8 x 50,000)= $450,000
(c)Overhead cost per unit when 40,000 units are produced: $370,000/40,000 units = $9.25 per unit;Overhead cost per unit when 50,000 units are produced: $450,000/50,000 units = $9 per unit

Willard Company Anticipates That Its Fixed Manufacturing Overhead Costs Will