Static Budget versus Flexible BudgetThe production supervisor of the Machining Department for Hagerstown Company agreed to the following monthly static budget for the upcoming year:Hagerstown CompanyMachining DepartmentMonthly Production Budget$420,000WagesUtilities23,000Depreciation38,000$481,000TotalThe actual amount spent and the actual units produced in the first three months in the Machining Department were as follows:Amount SpentUnits Produced$453,000Мay70,000June428,00063,000July409,00057,000The Machining Department supervisor has been very pleased with this performance because actual expenditures for May-July have been significantly lessthan the monthly static budget of 481,000. However, the plant manager believes that the budget should not remain fixed for every month but should "flex"or adjust to the volume of work that is produced in the Machining Department. Additional budget information for the Machining Department is as follows:Wages per hour$22.00Utility cost per direct labor hour$1.20Direct labor hours per unit0.25

There is no requirement mention in the question. Hence, based on the given data, we are preparing a…

Answered: Static Budget versus Flexible Budget…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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At the beginning of the period, the Cutting Department budgeted direct labor of $128,000, direct materials of $163,000 and fixed factory overhead of $14,000 for 8,000 hours of production. The department actually completed 10,200 hours of production. The appropriate total budget for the department, assuming it uses flexible budgeting, is Round your final answer to the nearest dollar. Do not round interim calculations. Oa. $385,025 Ob. $308,850 Oc. $388,875 Od. $305,000 ......
Phoenix Company reports the following fixed budget. It is based on an expected production and sales volume of 15,400 units. Sales Costa PHOENIX COMPANY Fixed Budget For Year Ended December 31 Direct materials Direct labor Sales staff commissions Depreciation-Machinery Supervisory salaries Shipping Sales staff salaries (fixed annual amount) Administrative salaries Depreciation-office equipment Income $ 3,234,000 1,001,000 246,400 46,200 295,000 198,000 231,000 251,000 610,700 193,000 $ 161,700
Lean Accounting The annual budgeted conversion costs for a lean cell are $70,500 for 1,500 production hours. Each unit produced by the cell requires 18 minutes of cell process time.. During the month, 1,050 units are manufactured in the cell. The estimated materials costs are $52 per unit. (Round the per unit cost to the nearest cent and use in subsequent computations. If required, round your answers to the nearest dollar.) Journalize the following entries for the month: a. Materials are purchased to produce 1,110 units. b. Conversion costs are applied to 1,050 units of production. c. The cell completes 1,000 units, which are placed into finished goods. If an amount box does not require an entry, leave it blank. a. b.
Tucker Inc. is preparing its Manufacturing Overhead Budget for the Quarter based on the following production in units. April May June QuarterProduction in units 20,000 10,000 15,000 45,000Tucker Inc. uses a variable manufacturing overhead rate of $2.50 per unit produced Fixed manufacturing overhad is $40,000 per month and includes $20,000 of non-cash costs (depreciation of plant assets). The total Variable Manufacturing Overhead cost for the quarter is: The total Fixed Manufacturing Overhead cost for the quarter is: Thet total Manufacturing Overhead costs for the quarter is: The total Cash disbursements for manufacturing overhead for the quarter is
Performance Report Based on Budgeted and Actual Levelsof ProductionBowling Company budgeted the following amounts:Variable costs of production:Direct materials 3 pounds @ $0.60 per poundDirect labor 0.5 hr. @ $16.00 per hourVOH 0.5 hr. @ $2.20FOH:Materials handling $6,200Depreciation $2,600 At the end of the year, Bowling had the following actual costs for production of 3,800 units:Direct materials $ 6,800Direct labor 30,500VOH 4,200FOH:Materials handling 6,300Depreciation 2,600Required:1. Calculate the budgeted amounts for each cost category listed above for the 4,000budgeted units.2. Prepare a performance report using a budget based on expected production of 4,000units.3. Prepare a performance report using a budget based on the actual level of production of3,800 units.
Shawke Company's partially completed flexible overhead budget for the current period follows. This budget is based on its predicted activity of 50% of productive capacity. Complete its flexible overhead budgets for the current period using 1,950, 3,900, and 5,850 units of productive capacity. For Year Ended December 31 Production (in units) Overhead costs Total variable overhead Total fixed overhead Total overhead costs Flexible Overhead Budgets Total Fixed Cost Variable Amount per Unit $ 12 $ 17,900 Flexible Budget at Capacity Level of 25% 50% 75% 1,950 3,900 5,850
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Courington Detailing's cost formula for its materials and supplies is $1,890 per month plus $8 per vehicle. For the month of August, the company planned for activity of 84 vehicles, but the actual level of activity was 49 vehicles. The actual materials and supplies for the month was $2,450. The materials and supplies in the flexible budget for August would be closest to: Multiple Choice $2,450 $1,417 $2,562 $2,282
1
At the beginning of the period, the Cutting Department budgeted direct labor of $128,000, direct materials of $163,000 and fixed factory overhead of $14,000 for 8,000 hours of production. The department actually completed 10,200 hours of production. The appropriate total budget for the department, assuming it uses flexible budgeting, is Round your final answer to the nearest dollar. Do not round interim calculations. Oa. $385,025 Ob. $308,850 Oc. $388,875 Od. $305,000 ......
PREKID ouogeping At the beginning of the period, the Fabricating Department budgeted direct labor of $120,400 and equipment depreciation of $45,000 for 8,600 hours of production. The department actually completed 10,800 hours of production. Determine the budget for the department, assuming that it uses flexible budgeting.
Monthly budgeted fixed overhead cost?

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