
ABC (Pty) Ltd started production of alphas at the beginning of January. Actual fixed manufacturing
Absorption costing net profit is R27 000 higher than variable costing net profit
Absorption costing net profit is R30 250 higher than variable costing net profit
Absorption costing net profit is R27 500 lower than variable costing net profit
Absorption costing net profit is R27 500 higher than variable costing net profit
Absorption costing net profit is R27 000 lower than variable costing net profit

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- The prôductión manager of Rordan Corporation has submitted the following quarterly production forecast for the upcoming fiscal year: 1st Quarter 8,600 2nd Quarter 6,500 3rd Quarter 7,300 4th Quarter 8, 200 Units to be produced Each unit requires 0.75 direct labor-hours, and direct laborers are paid $12.00 per hour. Required: 1. Prepare the company's direct labor budget for the upcoming fiscal year. (Round "Direct labor time per unit (hours)" answers to 2 decimal places.) Rordan Corporation Direct Labor Budget 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter Year Direct labor time per unit (hours) Total direct labor-hours needed Direct labor cost per hour Total direct labor cost ... 田 0 DELL ...arrow_forwardhe manufacturing overhead budget at Rost Corporation is based on budgeted direct labor-hours. The direct labor budget indicates that ,300 direct labor-hours will be required in September. The variable overhead rate is $8.5 per direct labor-hour. The company's budgeted ixed manufacturing overhead is $58,120 per month, which includes depreciation of $5,140. All óther fixed manufacturing overhead costs represent current cash flows. The September cash disbursements for manufacturing overhead on the manufacturing overhead budget should be: Multiple Choice $89,530. O $94,670. $36,550.arrow_forwardThe production supervisor of the Machining Department for Celtic Company agreed to the following monthly static budget for the upcoming year: Celtic Company Machining Department Monthly Production Budget Wages $290,000 Utilities 14,000 Depreciation 23,000 Total $327,000 The actual amount spent and the actual units produced in the first three months in the Machining Department were as follows: Amount Units Spent Produced January $308,000 70,000 February 290,000 63,000 March 277,000 57,000 The Machining Department supervisor has been very pleased with this performance because actual expenditures for January-March have been less than the monthly static budget of $327,000. 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 $19.00 Utility cost per direct labor hour…arrow_forward
- Whitmer Corporation is working on its direct labor budget for the next two months. Each unit of output requires 0.04 direct labor-hours. The direct labor rate is $9.10 per direct labor-hour. The production budget calls for producing 4,500 units In February and 5,000 units In March. Required: Prepare the direct labor budget for February and March, assuming that the direct labor work force is fully adjusted to the total direct labor-hours needed each month. (Round "labor-hours per unit" & "labor cost per hour" answers to 2 decimal places.) 12 Required production in units Direct labor-hours per unit Total direct labor-hours needed Direct labor cost per hour Total direct labor cost February Marcharrow_forwardElroy Corporation bases its manufacturing overhead budget on budgeted direct labor-hours. The variable overhead rate is $2.90 per direct labor-hour. The company's budgeted fixed manufacturing overhead is $198,560 per month, which includes depreciation of $28,970. All other fixed manufacturing overhead costs represent current cash flows. The July direct labor budget indicates that 9,800 direct labor-hours will be required in that month. Required: SHOW YOUR WORK in budget format a. Determine the cash disbursements for manufacturing overhead in good form, including heading, for January 2024b. Determine the predetermined overhead rate for July. (Round your answer to 2 decimal places.)arrow_forwardRasmussen Corporation expects to incur indirect overhead costs of $80,000 per month and direct manufacturing costs of $12 per unit. The expected production activity for the first four months of the year are as follows. January February March April Estimated production in units 6,000 7,000 3,000 4,000 Required Calculate a predetermined overhead rate based on the number of units of product expected to be made during the first four months of the year. Allocate overhead costs to each month using the overhead rate computed in Requirement a. Calculate the total cost per unit for each month using the overhead allocated in Requirement b.arrow_forward
- Acme Company's production budget for August is 18,200 units and includes the following component unit costs: direct materials, $8.00; direct labor, $10.70; variable overhead, $6.70. Budgeted fixed overhead is $39,000. Actual production in August was 19,440 units. Required: Prepare a flexible budget that would be used to compare against actual production costs for August. Note: Round "Cost per unit" to 2 decimal places. Direct materials Direct labor Variable overhead Fixed overhead Total budgeted cost Cost Formula Original Budget (18,200 units) $ 0 Flexed Budget (19,440 units) $ 0arrow_forwardThe production manager of Rordan Corporation has submitted the following quarterly production forecast for the upcoming fiscal year: Units to be produced 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter 9,000 7,000 7,500 8,400 Each unit requires 0.45 direct labor-hours, and direct laborers are paid $10.00 per hour. Required: 1. Prepare the company's direct labor budget for the upcoming fiscal year. (Round "Direct labor time per unit (hours)" answers to 2 decimal places.) Direct labor time per unit (hours) Total direct labor-hours needed Direct labor cost per hour Total direct labor cost 1st Quarter Rordan Corporation Direct Labor Budget 2nd Quarter 3rd Quarter 4th Quarter Yeararrow_forwardDavol Corporation is preparing its Manufacturing Overhead Budget for the fourth quarter of the year. The budgeted variable manufacturing overhead rate is $6.80 per direct labor-hour; the budgeted fixed manufacturing overhead is $72,000 per month, of which $20,000 is factory depreciation. If the budgeted direct labor time for October is 5,000 hours, then the total budgeted manufacturing overhead for October is:arrow_forward
- Haylock Incorporated bases its manufacturing overhead budget on budgeted direct labor-hours. The direct labor budget indicates that 8,300 direct labor-hours will be required in August. The variable overhead rate is $1.40 per direct labor-hour. The company's budgeted fixed manufacturing overhead is $100,320 per month, which includes depreciation of $9,030. All other fixed manufacturing overhead costs represent current cash flows. The August cash disbursements for manufacturing overhead on the manufacturing overhead budget should be: Multiple Choice $11,620 $102,910 $91,290 $111,940arrow_forwardrever Ready Company expects to operate at 85% of productive capacity during May. The total manufacturing costs for May for the production of 3,900 batteries are budgeted as follows: Direct materials Direct labor Variable factory overhead Fixed factory overhead Total manufacturing costs The company has an opportunity to submit a bid for 2,000 batteries to be delivered by May 31 to a government agency. If the contract is obtained, it is anticipated that the additional activity will not interfere with normal production during May or increase the selling or administrative expenses. $324,300 119,200 33,350 67,000 $543,850 What is the unit cost below which Forever Ready Company should not go in bidding on the government contract? Round your answer to two decimal places. per unitarrow_forwardProduction workers for Benson Manufacturing Company provided 380 hours of labor in January and 660 hours in February. Benson expects to use 4,000 hours of labor during the year. The rental fee for the manufacturing facility is $16,000 per month. Required Based on this information, how much of the rental cost should be allocated to the products made in January and to those made in February? (Do not round intermediate calculations.) Month Allocated Cost January Februaryarrow_forward
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