The direct labor budget of Yuvwell Corporation for the upcoming fiscal year contains the following details concerning budgeted direct labor-hours: 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter Budgeted direct labor-hours 12,000 10,200 10,500 11,300 The company uses direct labor-hours as its overhead allocation base. The variable portion of its predetermined manufacturing overhead rate is $7.00 per direct labor-hour and its total fixed manufacturing overhead is $88,000 per quarter. The only noncash item included in fixed manufacturing overhead is depreciation, which is $22,000 per quarter.

Required: 1. Prepare the company’s manufacturing overhead budget for the upcoming fiscal year.

2. Compute the company’s predetermined overhead rate (including both variable and fixed manufacturing overhead) for the upcoming fiscal year.

Yuvwell Corporation for the upcoming fiscal year contains the following details concerning budgeted direct labor-hours: 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter Budgeted direct labor-hours 12,000 10,200 10,500 11,300.

The company uses direct labor-hours as its overhead allocation base.

The variable manufacturing overhead rate is $7.00 per direct labor-hour.

Total fixed manufacturing overhead is $88,000 per quarter.

Depreciation is $22,000 per quarter.

A) Manufacturing overhead:

Total variable cost= 7* (12000 + 10200 + 10500 + 11300)= 308,000

Total fixed cost= (88,000 - 22,000)*4= 264,000

Total= $572,000

B) Estimated manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base

Estimated manufacturing overhead rate= (264,000/44,000) + 7= 13 per direct labor hour