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19) A company is preparing its budgets for the upcoming year. Current direct materials cost is $ 150,000, and current direct manufacturing labour is $
19) A company is preparing its budgets for the upcoming year. Current direct materials cost is $ 150,000, and current direct manufacturing labour is $ 1,000,000, both of which are expected to increase by 4% next year. Overhead costs currently are (for the year just ending) variable $ 18,000 and fixed $ 30,000. The firm expects to achieve a 2% cost reduction in overhead costs by continuous improvement. What is the company's expected cost for the upcoming year if production is the same number of units as the current year? a) $ 1,175,000 b) $ 1,176,920 o) $ 1,243,040 d) $ 1,196,920 e) $ 1,263,040
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