Cash disbursements for manufacturing overhead
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Question 6:
Cartier Inc. bases its manufacturing overhead budget on budgeted direct labor-hours. The variable overhead rate is $5.2 per direct labor-hour. The company's budgeted fixed manufacturing overhead is $40,330 per month, which includes depreciation of $12,370. All other fixed manufacturing overhead costs represent current cash flows. The direct labor budget indicates that 3,700 direct labor-hours will be required in April.
The April cash disbursements for manufacturing overhead on the manufacturing overhead budget should be:
$40,330
$47,200
$44,030
$52,700
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This provides the steps to calculate the cash disbursements for manufacturing overhead.
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