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Question - YumTown Frozen Foods is an emerging company in the market of high-end TV dinners. YumTown's postion takes on popular favorites such as steak and potatoes and macaroni and cheese have gained significant attention on cable food channels. However, as YumTown's level of activity has risen, the company has struggled to make sense of its manufacturing costs. Representatives have asked you to analyze the company's factory overhead costs and labor hours. YumTown accumulates the following data concerning a mixed cost by relating total factory overhead costs to direct labor hours.
As an HR Manager, human resource planning analyzes the data to make decisions on when to add additional employees in contrast to adding hours to current employees and this is impacted by changes both the fixed and variable costs. Hence HR planners are responsible for carefully exploring headcount and costs per employee and headcount relative to resources and overhead. For this reason, variance analysis is a valuable tool for human resource planning and forecasting.
What is the flexible budget formula for factory overhead?
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of purchase orders 400000 overhead cost of shipments 100000 of setups 300000direct labor hrs125000 of inspections
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