The master budget of Windy Co. shows that the planned activity level for next year is expected to be 50,000 machine hours. At this level of activity, the following manufacturing overhead costs are expected:
Indirect labor $720,000
Machine supplies 180,000
Indirect materials 210,000
Depreciation on factory building 150,000
Total manufacturing overhead $1,260,000
A flexible budget for a level of activity of 60,000 machine hours would show total manufacturing overhead costs of
a) $1,512,000.
b) $1,260,000.
c) $1,482,000.
d) $1,362,000.
Ans: c) $1,482,000.
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