PR?NTER viesios 4BACx SAppliance Possible Inc. (AP) is a manufacturer of toaster

Question

PR?NTER viesios 4BACx SAppliance Possible Inc. (AP) is a manufacturer of toaster ovens. To imerove control over operations, the president of AP wants to begin uaing a lesble busgeting system, raeher than use ony the cunmet RE master budget. The following data are available for AP's expected costs at production leveils of 82,000, 96,000, and 110,000 units h Variable costs Manufacturing tAdministrative eSelling $7 per unn $4 per unit $1 per unit Fixed costs Manufacturing Administrative 160,000 $79,000 0, 96,000, and 110,000 units, (List variable costs before fixed costs) Prepare a fiexibie budget for each of the possible production leves: 82,00 POSSIBLE INC 2

Explanation / Answer

Flexible Budget Expected Production Levels 82000 96000 110000 Variable Cost: Manufacturing 574000 672000 770000 Admin 328000 384000 440000 Selling 82000 96000 110000 Total variable cost 984000 1152000 1320000 Fixed Cost: Manufacturing 160000 160000 160000 Admin 79000 79000 79000 Total Fixed Cost 239000 239000 239000 Total Cost 1223000 1391000 1559000

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