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Home Q & A Board Other Fields Homework Help Business Economics
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StormLrd StormLrd
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6 years ago
Jael Equipment uses a flexible budget for its indirect manufacturing costs. For 2015 the company anticipated that it would produce 18,000 units with 3,500 machine-hours and 7,200 employee days. The costs and cost drivers were to be as follows:

   Fixed   Variable   Cost Driver
Product handling   $30,000   $0.40   per unit
Inspection   8,000    8.00   per 100 unit batch
Utilities   400   4.00   per 100 unit batch
Maintenance   1,000   0.20   per machine-hour
Supplies      5.00   per employee day

During the year, the company processed 20,000 units; worked 7,500 employee days; and, had 4,000 machine hours. The actual costs for 2015 were:

   Actual
Product handling    $36,000
Inspection   9,000
Utilities   1,600
Maintenance   1,200
Supplies   37,500

Required:
a.   Prepare the static-budget using the overhead items above and then compute the static-budget variances.
b.   Prepare the flexible-budget using the overhead items above and then compute the flexible-budget variances.
Textbook 
Cost Accounting: A Managerial Emphasis, Canadian Edition

Cost Accounting: A Managerial Emphasis, Canadian Edition


Edition: 7th
Authors:
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MunihasenMunihasen
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StormLrd Author
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6 years ago
Just got PERFECT on my quiz
kobbhy
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You make an excellent tutor!
DAGINC
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2 hours ago
I appreciate what you did here, answered it right Smiling Face with Open Mouth
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