5) Turner, Inc. budgeted 10,000 widgets for production during 2016. Turner has capacity to produce 15,000 units. The sale price of the widgets is $80 per unit. Fixed factory overhead is allocated using direct labour hours. The following estimated costs were provided: Direct material $ 80,000 Direct labour 600,000 50,000 20,000 Variable manufacturing overhead Fixed factory overhead costs Total $750,000 During the year 8,000 units were produced, and 7,000 units was sold. When preparing the static budget for the production department, which level of activity should the company use? A. 7,000 units B. 8,000 units C. 10,000 units D. 15,000 units
5) Turner, Inc. budgeted 10,000 widgets for production during 2016. Turner has capacity to produce 15,000 units. The sale price of the widgets is $80 per unit. Fixed factory overhead is allocated using direct labour hours. The following estimated costs were provided: Direct material $ 80,000 Direct labour 600,000 50,000 20,000 Variable manufacturing overhead Fixed factory overhead costs Total $750,000 During the year 8,000 units were produced, and 7,000 units was sold. When preparing the static budget for the production department, which level of activity should the company use? A. 7,000 units B. 8,000 units C. 10,000 units D. 15,000 units
Managerial Accounting
15th Edition
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:Carl Warren, Ph.d. Cma William B. Tayler
Chapter4: Activity-based Costing
Section: Chapter Questions
Problem 9E: Nozama.com Inc. sells consumer electronics over the Internet. For the next period, the budgeted cost...
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