Roche Company uses a flexible budget for manufacturing overhead based on direct labor hours. Variable manufacturing overhead costs per direct labor hour are as follows.

Indirect labor .... $1.00

Indirect materials ... 0.50

Utilities ....... 0.40

Fixed overhead costs per month are: Supervision $4,000, Depreciation $1,500 and Property Taxes $800. The company believes it will normally operate in a range of 7,000–10,000 direct labor hours per month.

Instructions

Prepare a monthly manufacturing overhead flexible budget for 2011 for the expected range of activity, using increments of 1,000 direct labor hours.