Fruta Inc. purchases fruit from numerous growers and packs fruit boxes and fruit baskets for sale. Fruta has developed the following flexible budget for overhead for the coming year. Activity level is measured in direct labor hours.

Required:
1. Prepare an overhead budget for May.
2. The Cushing High School Parent–Teacher Organization ordered 200 gift baskets from Fruta to be given to high school teachers and support staff as a thank you for a successful school year. These gift baskets must be ready by May 31 and were not included in the original production budget for May. Without preparing a new overhead budget, what is Fruta's new total budgeted overhead forMay?

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Activity Level (hours) 2,000 2,500 3,000 Variable costs: $0.80 0.20 0.40 $1.40 $1,600 400 800 2,800 $ 2,400 600 1,200 $ 4,200 Maintenance 2,000 Supplies Power 1,000 3,500 Total variable costs Fixed costs $4,800 18,000 $22,800 $25,600 4,800 18,000 $22,800 $26,300 S 4,800 18,000 $22,800 $27,000 Depreciation Salaries Total fixed costs Total overhead costs