Question

Becker Bikes manufactures tricycles. The company expects to sell 510 units in May and 640 units in June. Beginning and ending finished goods for May is expected to be 175 and 140 units, respectively. June’s ending finished goods is expected to be 150 units. The company’s variable overhead is $10.50 per unit produced and its fixed overhead is $11,000 per month. Compute Becker’s manufacturing overhead budget for May and June. (Do not round intermediate calculations. Round your final answers to 2 decimal places.)

	May June Budgeted manufacturing overhead

Answer 1

Manufacturing Overhead Budget for May = $15,987.50

Manufacturing Overhead Budget for June = $17,825.00

Total Manufacturing Overhead Budget for May and June = $33,812.50

Calculation:

Month	Opening Stock = (Closing stock of previous month)	Closing Stock	Sales	Units Produced = (Sales for the month - Opening Stock + Closing Stock)	Variable Overhead Rate per unit produced	Total Variable Overhead = (No. of Units Produced X Variable Overhead Rate per unit)	Fixed Overhead	Total Manufacturing Overhead for the month = Variable Overhead + Fixed Overhead
May	175	140	510	475	10.50	4,987.50	11,000.00	15,987.50
June	140	150	640	650	10.50	6,825.00	11,000.00	17,825.00
							Total	33,812.50