Barrick Company Has Established a Flexible Budget for Manufacturing Overhead $\text { Variable costs (total): }$

Barrick Company has established a flexible budget for manufacturing overhead based on direct labour-hours. Total budgeted costs at 200,000 direct labour-hours are as follows $\text { Variable costs (total) : }$
$\begin{array}{ll}\text { Packing supplies } & £ 120,000 \\\text { Indirect labour } & £ 180,000 \\\text { Fixed costs (total) : } & \\\text { Utilities } & £ 100,000 \\\text { Rent } & £ 40,000 \\\text { Insurance } & £ 20,000\end{array}$
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If Barrick Company plans to operate at 190,000 direct labour-hours during the next period, the flexible budget would show indirect labour costs of

A) £171,000.
B) £180,000.
C) £114,000.
D) £270,000.

Correct Answer:

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