Raney Company uses a flexible budget for manufacturing overhead based on direc

Raney Company uses a flexible budget for manufacturing overhead based on direct labor hours. Variable manufacturing overhead costs per direct labor hour
are as follows:

Indirect labor

1.00

Indirect materials

0.50

Utilities

0.40

Fixed overhead costs per month are:

Supervision

4000

Depreciation

1500

Property Taxes

800

The company believes it will normally operate in a range of 7000 to 10000 direct labor hours per month.

Instructions:

Prepare a monthly flexible manufacturing overhead budget for 2010 for the expected range of activity using increments of 1000 direct labor hours.