Prepare a flexible budget for the production of 80% and 100% activity on the basis of the following information.
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Master Budget
A master budget can be defined as an estimation of the revenue earned or expenses incurred over a specified period of time in the future and it is generally prepared on a periodic basis which can be either monthly, quarterly, half-yearly, or annually. It helps a business, an organization, or even an individual to manage the money effectively. A budget also helps in monitoring the performance of the people in the organization and helps in better decision-making.
Sales Budget and Selling
A budget is a financial plan designed by an undertaking for a definite period in future which acts as a major contributor towards enhancing the financial success of the business undertaking. The budget generally takes into account both current and future income and expenses.
Prepare a flexible budget for the production of 80% and 100% activity on the basis of the following information.
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- Sales volume (units) Revenue Variable costs Direct materials Direct labor Contribution margin Fixed costs Profit $30,000 $2.00 $45,000 Use direct labor dollars as the cost driver. Compute allocated fixed costs for Product X: O $20,000 Product X 400 $60,000 $50,000 $25,000 $15,000 $20,000 Product Y 600 $60,000 $15,000 $10,000 $35,000 Total 1,000 $120,000 $40,000 $25,000 $55,000 $50,000 $5,000Sales volume (units) Revenue Variable costs Direct materials Direct labor Contribution margin Fixed costs Profit Product A 400 $60,000 Product B 600 $60,000 $25,000 $15,000 $10,000 $15,000 Total 1,000 $120,000 $40,000 $25,000 $25,000 $30,000 $55,000 $50,000 $5,000 Use direct labor dollars as the cost driver. Compute allocated fixed costs for Product A:Task 6. The following are consumed for the production of one unit: ➤ 18 kg of material A (price 1 € / kg and 3 m²) material B (price 2 € / m²) Direct labour per unit of product Estimated (planned) variable overheads per year Responsibility centre 14,000, € 1: Direct labour 70,000 h ===== ===== Responsibility centre 21 000, € Responsibility centre 1: 20 hours; rate 0,30€/h Responsibility centre 2: 30 hours; rate 0,50€/h Calculates: 1. variable production costs per unit 2. unit cost of production 3. full cost of one unit 2: Direct labour 180 000 h Estimated (planned)fixed overheads and general operating expenses per year Production costs - 100,000 € Selling expenses -30 000 € Administration expenses -15 000 €
- Direct materials per unit Direct labor per unit Variable overhead per unit Variable selling and administrative expenses $80 per unit $60 per unit $25 per unit $50 per unit $100,000 Fixed overheads Fixed selling and administrative expenses $300,000 If the company produced and sold 50,000 units of Product M during the year, then the total period cost under variable costing would be: a. $8,250,000 b. $2,900,000 c. $2,800,000 d. $2,750,000Task 6. The following are consumed for the production of one unit: ➤18 kg of material A (price 1 € / kg and 3 m²) material B (price 2 € / m²) Direct labour per unit of product Responsibility centre 1: 20 hours; rate 0,30€/h ==== Responsibility centre 2: 30 hours; rate 0,50€/h Calculates: Estimated (planned) variable overheads per year Responsibility centre 1: 14,000, € Direct labour 70,000 h Responsibility centre 2: 21 000, € Direct labour 180 000 h 1. variable production costs per unit 2. unit cost of production 3. full cost of one unit Estimated (planned) fixed overheads and general operating expenses per year Production costs - 100,000 € Selling expenses -30 000 € Administration expenses -15 000 €Contribution margin $ 26, 100 $ 10, 600 $ 25, 400 Fixed costs allocated to each product line 10, 980 15, 840 21, 360
- Direct labor Direct materials Overhead Total variable overhead Total fixed overhead Expected units to be produced Product cost per unit under absorption costing $ SA GA $ 17 per unit 11 per unit $30,000 $100,000 50,000 unitsGizmo Whiz manufactures premium food processors. The following are some manufacturing overhead (MOH) data for Gizmo Whiz for the year ended December 31, 2020 (Click the loon to view the overhead data) Read the requirements 1. The budgeted number of machine-hours planned in 2. The budgeted fixed manufacturing overhead costs per machine-hour is 3. The budgeted variable manufacturing overhead costs per machine-hour is 4. The budgeted number of machine-hours allowed for actual output produced in 5. The actual number of output units is (Round your answer to one decimal place.) 6. Actual number of machine-hours used per outpul unit isInput required per unit Standard cost per unit Standard cost per unit Direct Materials 6 kg per unit P90 per kg P540 Direct Labor 5 hours per unit P50 per hour P250 Other information follows: Budgeted factory overhead for the year: Variable 480,000 Fixed 600,000 The company's normal capacity per month is 400 units Actual cost materials purchased for the year is P2,342,000 During the year, direct materials purchased is 26,880 kg while direct materials actually used is 24,760 kgs Actual labor costs for the year 1,080,000 of which 24,900 direct labor hours was consumed Actual factory overhead amounted to 1,320,000, 65% of which is fixed cost, FOH is based on labor hours Actual production during the year 5,150 units Compute for Variable Overhead Efficiency Variance
- Given the cost formula, Y = $16,000+ $3.40x, total cost for an activity level of 4,000 units would be: A. $13,600 OB. $3,600 C. $29,600 O D. $16,000he following information relates to product A: Quantity Unit Price Cost Per Unit Material (kg) 5 £15 £75 Labour (hours) 4 £20 £80 Budgeted production 1250 Units Actual production 1000 Units Actual inputs were as follows: Material 6000 Kgs £100,000 Labour 3800 hours £70,000 A). Calculate Material Usage Variance. Choose one from the following: A. £10,000 Favourable B. £10,000 Unfavourable C. £15,000 Favourable D. £15,000 UnfavourableInput required per unit Standard cost per unit Standard cost per unit Direct Materials 6 kg per unit P90 per kg P540 Direct Labor 5 hours per unit P50 per hour P250 Other information follows: Budgeted factory overhead for the year: Variable 480,000 Fixed 600,000 The company's normal capacity per month is 400 units Actual cost materials purchased for the year is P2,342,000 During the year, direct materials purchased is 26,880 kg while direct materials actually used is 24,760 kgs Actual labor costs for the year 1,080,000 of which 24,900 direct labor hours was consumed Actual factory overhead amounted to 1,320,000, 65% of which is fixed cost, FOH is based on labor hours Actual production during the year 5,150 units Compute for Controllable Variance