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    Flexible Overhead Budget, Report and Responsibilty Report

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    Hay's Corporation is continuing its budget preparations. Hay's had the following static budget and overhead costs for March.

    Hay's Corporation Hay's Corporation
    Manufacturing Overhead Budget (Static) Manufacturing Overhead Costs (Actual)
    For the Month of March For the Month of March
    Budgeted production in units 117,500 Production in units 118,500
    Budgeted costs Costs
    Indirect materials $ 7,050 Indirect materials $ 7,100
    Indirect labor 11,750 Indirect labor 11,825
    Utilities 10,575 Utilities 10,700
    Maintenance 5,875 Maintenance 5,900
    Salaries 42,000 Salaries 42,000
    Depreciation 16,800 Depreciation 16,800
    Property taxes 2,500 Property taxes 2,500
    Insurance 1,200 Insurance 1,200
    Janitorial 1,300 Janitorial 1,300

    Total budgeted costs $99,050 Total costs $99,325

    Hay's produced 118,500 units in March rather than the budgeted number of units.

    Instructions
    (a) Prepare a flexible overhead budget based on the following amounts produced.

    (1) 115,500 units
    (2) 116,500 units
    (3) 117,500 units
    (4) 118,500 units
    (5) 119,500 units

    (b) Prepare a flexible budget report showing the differences (favorable and unfavorable) in manufacturing overhead costs for the month of March.

    (c) Prepare a responsibility report for the manufacturing overhead for March, assuming only variable costs are controllable.

    Can you please give me a detail on how it is calculated step by step?

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    Solution Summary

    This solution provides assistance with a flexible overhead budget, a report, and a responsibility report.

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