A Company's Planned Activity Level for Next Year Is Expected

question 107

Multiple Choice

A company's planned activity level for next year is expected to be 100,000 machine hours.At this level of activity, the company budgeted the following manufacturing overhead costs: $\begin{array}{lrlr}\text { Variable }&&\text { Fixed }\\\hline \text { Indirect materials } & \$ 140,000 & \text { Depreciation } & \$ 60,000 \\\text { Indirect labor } & 200,000 & \text { Taxes } & 10,000 \\\text { Factory supplies } & 20,000 & \text { Supervision } & 50,000\end{array}$ A flexible budget prepared at the 80,000 machine hours level of activity would show total manufacturing overhead costs of

• A)$288,000.
• B)$360,000.
• C)$384,000.
• D)$408,000.

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Definitions:

Pyroclastic Flow

A fast-moving current of hot gas and volcanic materials (such as ash and rock fragments) that flows down the side of a volcano during an explosive eruption.

Mudflows

Fast-moving rivers of mud, usually triggered by heavy rainfall or volcanic activity, capable of causing significant damage.

Landslides

The rapid movement of a large amount of earth material, such as rock or soil, down a slope, often triggered by rain or earthquakes.

Mudflows

Rapidly flowing mixtures of water and sediment, usually occurring in areas with steep terrain and loose soil, often initiated by intense rainfall or volcanic activity.