Gordon Company's controller, Eric Junior, estimated the following formula, based on monthly data, for overhead cost:

Overhead Cost = $150,000 + ($52 x Direct Labor Hours)

Required:

1. If next month's budgeted direct labor hours equal 8,000, what is the budgeted overhead cost?

2. If next quarter's budgeted direct labor hours equal 23,000, what is the budgeted overhead cost?

3. If next year's budgeted direct labor hours equal 99,000, what is the budgeted overhead cost?

Gordon Company

Overhead Cost = $150,000 + ($52 x Direct Labor Hours)

Budgeted overhead cost For next month = $150,000 + ($52 x 8000)

=$ 150,000 + 416,000

Budgeted overhead cost For next month = $ 566,000

Budgeted overhead cost For next quarter = $150,000 + ($52 x 23,000)

=$ 150,000 + 1196,000

Budgeted overhead cost For next quarter = $ 1346,000

Budgeted overhead cost For next year = $150,000 + ($52 x 99,000)

= = $ 150,000 + 5148,000

Budgeted overhead cost For next year = $ 5298,000