Question
Appliance Possible Inc. (AP) is a manufacturer of toaster ovens. To improve control over operations, the president of AP wants to begin using a flexible
Appliance Possible Inc. (AP) is a manufacturer of toaster ovens. To improve control over operations, the president of AP wants to begin using a flexible budgeting system, rather than use only the current master budget. The following data are available for APs expected costs at production levels of 89,000, 103,000, and 117,000 units.
Variable costs | ||
Manufacturing | $7 per unit | |
Administrative | $4 per unit | |
Selling | $2 per unit | |
Fixed costs | ||
Manufacturing | $151,000 | |
Administrative | $77,000 |
Prepare a flexible budget for each of the possible production levels: 89,000, 103,000, and 117,000 units. (List variable costs before fixed costs.)
APPLIANCE POSSIBLE INC. Flexible Production Cost Budget | ||||||
ManufacturingFixed CostsTotal Fixed CostsTotal Variable CostsTotal CostsProduction LevelsVariable CostsAdministrativeSellingActivity Level | ||||||
Fixed CostsAdministrativeTotal Variable CostsTotal Fixed CostsTotal CostsActivity LevelSellingVariable CostsManufacturingProduction Levels | ||||||
Fixed CostsProduction LevelsAdministrativeActivity LevelTotal Variable CostsSellingVariable CostsManufacturingTotal Fixed CostsTotal Costs | ||||||
Production LevelsActivity LevelAdministrativeTotal Variable CostsFixed CostsTotal Fixed CostsTotal CostsManufacturingSellingVariable Costs | $ | $ | $ | |||
Fixed CostsManufacturingAdministrativeTotal Variable CostsVariable CostsProduction LevelsTotal CostsActivity LevelSellingTotal Fixed Costs | ||||||
Total CostsFixed CostsTotal Variable CostsVariable CostsProduction LevelsTotal Fixed CostsSellingAdministrativeActivity LevelManufacturing | ||||||
Total Variable CostsActivity LevelManufacturingFixed CostsTotal Fixed CostsVariable CostsTotal CostsAdministrativeSellingProduction Levels | ||||||
Variable CostsTotal CostsTotal Variable CostsTotal Fixed CostsManufacturingActivity LevelSellingFixed CostsAdministrativeProduction Levels | ||||||
Total Fixed CostsManufacturingSellingActivity LevelProduction LevelsTotal Variable CostsFixed CostsTotal CostsAdministrativeVariable Costs | ||||||
Total CostsVariable CostsTotal Variable CostsSellingFixed CostsManufacturingProduction LevelsActivity LevelAdministrativeTotal Fixed Costs | ||||||
Total CostsTotal Variable CostsTotal Fixed CostsManufacturingVariable CostsAdministrativeSellingFixed CostsActivity LevelProduction Levels | ||||||
Fixed CostsSellingTotal Variable CostsManufacturingVariable CostsTotal CostsAdministrativeActivity LevelProduction LevelsTotal Fixed Costs | $ | $ | $ |
eTextbook and Media
If AP sells the toaster ovens for $17 each, how many units will it have to sell to make a profit of $208,000 before taxes?
Units to be sold | Type your answer here |
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