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Manufacturing Overhead Budget Example

Explore a manufacturing overhead budget example.

Manufacturing Overhead Budget

Budgeted DLH: April 1,3k, May 2.3k, June 1.45k, Q 5.050. Variable mfg. OH rate: April $20, May$20, June$20, Q$20. Variable mfg. OH costs: April $26k, May $46k, June $29k, Q $101k. Fixed mfg. OH costs: April 50k, May 50k, June 50k, Q150k. Total mfg. OH costs: April 76k, May 96k, June 79k, Q 251k. Less: non-cash costs: April 20k, May 20k, June 20k, Q 60k. Cash disbursements for manufacturing OH: April $56k, May $76k, June $59k, Q$ 191k

\[\frac{Total \hspace{1mm} MOH \hspace{1mm} for \hspace{1mm} quarter}{Total \hspace{1mm} labour \hspace{1mm} hours \hspace{1mm} required}\]

Example

\(\frac{$251,000}{5,050}\) = $49.70 per hour*

* rounded

Ending Finished Goods Inventory Budget

Quantity of production cost per unit * cost = total cost per unit, once all of them are added we get the unit product cost. To get the ending finish goods inventory multiply the ending inventory in units (product budget) * unit product cost

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