Bonita Company is well known for its high-quality men’s shoes. It manufactures all of its products in regional facilities throughout North America, trying to source DM locally when possible. Managers in the production area of one of its plants are beginning to work on next year’s first quarter budgets to ensure they’ll have the necessary resources available. 

Sales are expected to be steady, with 3,800 pairs of shoes (one pair is one unit) budgeted in January. February and March have anticipated sales volume of 3,600 units each, while April will be down slightly to 3,700 units. 

In order to prevent stock-outs, Bonita’s policy requires 15% of the following month’s sales be held in ending inventories for all of its shoes.  This policy is expected to be met on December 31 of this year. 

Additional DL and MOH information is as follows. 

Standard DL time 0.5 hours per unit 

DL rate $13.00 per DL hour 

Variable MOH rate $1.40 per DL hour 

Fixed MOH costs Supervisor salaries $3,700 per month 

Depreciation on plant assets $6,900 per month 

Insurance and taxes $4,100 per month

Required
  

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Prepare the MOH budget for quarter 1 for this facility, identifying total MOH costs as well as cash outlay amount for MOH. (Round answers to 2 decimal places, e.g. 15.25.) Prepare the MOH budget for quarter 1 for this facility, identifying total MOH costs as well as cash outlay amount for MOH. (Round answers to 2 decimal places, e.g. 15.25.)

Answer rating: 100% (QA)

To prepare the Manufacturing Overhead MOH budget for quarter 1 at Bonita Companys facility we need t... View the full answer