Tempo Company's fixed budget (based on sales of 10,000 units) folllows. Fixed Budget Sales (10,000 units x $203 per unit) Costs Direct materials Direct labor Indirect materials Supervisor salary Sales commissions Shipping Administrative salaries Depreciation-Office equipment Insurance Office rent Income 2,030,000 250,000 420,000 280,000 50,000 90,000 160,000 100,000 70,000 40,000 50,000 520,000 1. Compute total variable cost per unit. 2. Compute total fixed costs. 3. Prepare a flexible budget at activity levels of 8,000 units and 12,000 units.

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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Tempo Company's fixed budget (based on sales of 10,000 units) folllows.
Fixed Budget
Sales (10,000 units x $203 per unit)
Costs
Direct materials
Direct labor
Indirect materials
Supervisor salary
Sales commissions
Shipping
Administrative
salaries
Depreciation-Office equipment
Insurance
Office rent
Income
2,030,000
250,000
420,000
280,000
50,000
90,000
160,000
100,000
70,000
40,000
50,000
520,000
1. Compute total variable cost per unit.
2. Compute total fixed costs.
3. Prepare a flexible budget at activity levels of 8,000 units and 12,000 units.
Transcribed Image Text:Tempo Company's fixed budget (based on sales of 10,000 units) folllows. Fixed Budget Sales (10,000 units x $203 per unit) Costs Direct materials Direct labor Indirect materials Supervisor salary Sales commissions Shipping Administrative salaries Depreciation-Office equipment Insurance Office rent Income 2,030,000 250,000 420,000 280,000 50,000 90,000 160,000 100,000 70,000 40,000 50,000 520,000 1. Compute total variable cost per unit. 2. Compute total fixed costs. 3. Prepare a flexible budget at activity levels of 8,000 units and 12,000 units.
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