5 Demco Berhad produces a single product and used flexible budgetary control system as part of company's planning. The company assigns the manufacturing overhead costs to production on the basis of machine hours. Below is part of the budgeted overhead cost based on machine hours: Capacity 80% 100% Machine hours Maintenance Supplies 40,000 50,000 RM34,000 RM46,000 RM28,000 RM30,000 During April 2020, the company operated at 85% of machine hours and the actual overhead cost for maintenance and supplies are RM38,750 and RM26,375 respectively. The maintenance cost is a semi variable where there is a step up cost of RM5,000 in the fixed cost element for volumes in excess of 40,000 machine hours. The actual fixed costs remains as budgeted. Calculate the variable cost per machine hour for maintenance cost above. A. RMO.20 per machine hour B. RM0.60 per machine hour C. RMO.70 per machine hour D. RM1.20 per machine hour

5 Demco Berhad produces a single product and used flexible budgetary control system as part of company's planning. The company assigns the manufacturing overhead costs to production on the basis of machine hours. Below is part of the budgeted overhead cost based on machine hours: Capacity 80% 100% Machine hours Maintenance Supplies 40,000 50,000 RM34,000 RM46,000 RM28,000 RM30,000 During April 2020, the company operated at 85% of machine hours and the actual overhead cost for maintenance and supplies are RM38,750 and RM26,375 respectively. The maintenance cost is a semi variable where there is a step up cost of RM5,000 in the fixed cost element for volumes in excess of 40,000 machine hours. The actual fixed costs remains as budgeted. Calculate the variable cost per machine hour for maintenance cost above. A. RMO.20 per machine hour B. RM0.60 per machine hour C. RMO.70 per machine hour D. RM1.20 per machine hour

Principles of Cost Accounting

17th Edition

ISBN:9781305087408

Author:Edward J. Vanderbeck, Maria R. Mitchell

Publisher:Edward J. Vanderbeck, Maria R. Mitchell

Chapter7: The Master Budget And Flexible Budgeting

Section: Chapter Questions

Problem 8P: Preparing a performance report Use the flexible budget prepared in P7-6 for the 29,000-unit level of...

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