Haroot Company's Master Budget Shows That the Planned Activity Level

question 46

Multiple Choice

Haroot Company's master budget shows that the planned activity level for next year is expected to be 20,000 machine hours.At this level of activity, the following manufacturing overhead costs are expected: $$\begin{array} { l r } \text { Indirect labour } & \$ 45,000 \\\text { Factory supplies } & 4,000 \\\text { Indirect materials } & 21,000 \\\text { Depreciation on factory building } & 15,000 \\\text { Total manufacturing overhead } & \$ 85,000\end{array}$$ Indirect labour, factory supplies and indirect materials are variable costs.If the company operates at 21,000 machine hours, how much is allowed on a flexible budget for manufacturing overhead costs?

• A)$89,250
• B)$73,500
• C)$88,500
• D)$85,000

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Definitions:

Formula Error

Occurs when a formula in a software application, like a spreadsheet, is incorrectly written or references invalid data, resulting in incorrect or unexpected outcomes.

Named Ranges

In spreadsheet applications, a feature that allows users to assign a memorable name to a particular range of cells for easier reference.

Formula Errors

Refers to mistakes or issues within computational expressions in spreadsheet software, causing incorrect results or failures.

PMT Function

It is a financial function that calculates the payment for a loan based on constant payments and a constant interest rate.