In: Accounting
The static budget for Van Enterprises includes the production of 10,000 units. Van has also budgeted $50,000 for direct labor, $44,000 for direct materials, utility costs of $5,000, and the plant manager's salary of $15,000. A flexible budget for 12,000 units of production would show:
Group of answer choices
the same cost structure in total
direct materials of $60,000, direct labor of $52,800, utilities of $6,000, and plant manager's salary of $15,000
total variable costs of $136,800
direct labor of $60,000, direct materials of $52,800, utilities of $6,000, and plant manager's salary of $15,000
Calculate following
Flexible budget | |
Direct labor | 50000/10000*12000 = 60000 |
Direct material | 44000/10000*12000 = 52800 |
Utilities | 5000/10000*12000 = 6000 |
Plant manager salary | 15000 |
So answer is d) direct labor of $60,000, direct materials of $52,800, utilities of $6,000, and plant manager's salary of $15,000