Refer to DCdesserts.com€™s activity-based flexible budget in Exhibit 1l€”1l. Suppose that the company€™s activity in June is described as follows:
Process hours ............... 7,500
Production runs .............. 16
New products tested ............ 30
Direct material handled (pounds) .......40, 000

Required:

1. Determine the flexible budgeted cost for each of the following:
a. Indirect material
b. Utilities
c. Inspection
d. Test kitchen
e. Material handling
f. Total overhead cost
2. Compute the variance for setup cost during the month, assuming that the actual setup cost was $3,000:
a. Using the activity based flexible budget.
b. Using DCdesserts.com€™s conventional flexible budget(Exhibit).

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Microsoft Excel-Flexible Overhead Budget-DCdesserts.com 凹Eile Edit yew Insert Fgmet Tools Data ygindow help 痴=G19+G31 G32 6 DCdesserts.com Monthly Flexible Overhead Budget Process Hours 6,000 7.5009,000 7 Budgeted costs 9 Variable costs: 10 Indirect material 11Nonstick cooking spray 12,000 15,000 S 18,000 2,000 2,5003,000 2,000 500 3,000 6,0007,5009,000 12 Waxed paper 13 Other paper products 14Miscellaneous supplies 15Indirect labor: maintenance 16Utilities 17 Electricity 18 Natural gas 19 Total variable cost 20 21 22 Fixed costs 4.000 5,0006,000 3,0003,7504,500 1,0002501,500 $ 30,000 37,500 $45,000 23 Indirect labor: 24 Inspection 25 Production supervisors 26 Setup 27 Material handling 28 Depreciation: plant and equipment 29 Insurance and property taxes 30 Test kitchen 31 Total fixed cost 32 Total overhead cos $ 2.2002.200 2.200 6,0006,0006,000 3,0003,000 3,000 2,000 2,000 2,000 500 100 1,200200 1,200 ー 500 100 500 100 15,000 $ 15,000 15,000 $ 45,000 | $ 52.5001 $ 60.000 N MSheet1 Sheet2 Sheet3/ Ready