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Blue Chair Inc. is one of the largest manufacturers of office furniture in the United States. In Michigan, it produces filing cabinets in two departments:
Blue Chair Inc. is one of the largest manufacturers of office furniture in the United States. In Michigan, it produces filing cabinets in two departments: Fabrication and Assembly. Assume the following information for the Assembly Department:
Line Item Description | Amount |
---|---|
Direct labor per filing cabinet | 20 minutes |
Supervisor salaries | $138,000 per month |
Depreciation | $31,000 per month |
Direct labor rate | $15 per hour |
Prepare a flexible budget for 10,000, 13,000, and 15,000 filing cabinets for the month of August, similar to Exhibit 5, assuming that inventories are not significant. Enter all amounts as positive numbers.
Line Item Description | Amount | Amount | Amount |
---|---|---|---|
Units of production | 10000 | 13000 | 15000 |
Variable cost: | |||
Accounts payableDirect laborIndirect laborIndirect materialsSupervisor salariesDirect labor | $Direct labor | $Direct labor | $Direct labor |
blank | blank | blank | blank |
Fixed cost: | |||
Accounts payableDirect laborIndirect laborIndirect materialsSupervisor salariesSupervisor salaries | $Supervisor salaries | $Supervisor salaries | $Supervisor salaries |
DepreciationDirect laborDirect materialsIndirect laborIndirect materialsDepreciation | Depreciation | Depreciation | Depreciation |
Total fixed cost | $Total fixed cost | $Total fixed cost | $Total fixed cost |
Total department costs | $Total department costs | $Total department costs | $Total department costs |
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