A company’s planned activity level for next year is expected to be 50,000 machine hours. At this level of activity, the

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A company’s planned activity level for next year is expected to
be 50,000 machine hours. At this level of activity, the company
budgeted the following manufacturing overhead costs:
Variable Fixed
Indirect materials $90,000 Depreciation $37,500
Indirect labor 120,000 Taxes
7,500
Factory supplies 15,000 Supervision
30,000
A flexible budget prepared at the 90,000 machine hours level of
activity would show total manufacturing overhead costs of
$405,000
$480,000
$477,500
$425,000