A CPA prepared a budget for her client, a specialty manufacturing shop. The budget is based on
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Question:
A CPA prepared a budget for her client, a specialty manufacturing shop. The budget is based on machine-hours. The company's static planning budget for the month appears below:
Budgeted number of machine-hours | 6,000 | |
Budgeted variable costs: | ||
Supplies (@ $6.90 per machine-hour) | $ | 41,400 |
Power (@ $3.70 per machine-hour) | 22,200 | |
Budgeted fixed costs: | ||
Salaries | 51,600 | |
Equipment depreciation | 26,400 | |
Total expense | $ | 141,600 |
Required:
Prepare a flexible budget for 6,400 machine-hours per month. You can use the table function to prepare the flexible budget. Show all of your calculations.
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