Tempo Company's fixed budget (based on sales of 7,000 units) follows. Fixed Budget Sales (7,000 units...
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Tempo Company's fixed budget (based on sales of 7,000 units) follows. Fixed Budget Sales (7,000 units x $400 per unit) Costs Direct materials Direct labor Indirect materials $ 2,800,000 280,000 490,000 175,000 Supervisor salary 65,000 Sales commissions 140,000 Shipping 154,000 Administrative salaries 210,000 Depreciation-Office equipment 35,000 Insurance 20,000 Office rent 36,000 Income 1,195,000 1. Compute total variable cost per unit. 2. Compute total fixed costs. 3. Prepare a flexible budget at activity levels of 6,000 units and 8,000 units. Tempo Company's fixed budget (based on sales of 7,000 units) follows. Fixed Budget Sales (7,000 units x $400 per unit) Costs Direct materials Direct labor Indirect materials $ 2,800,000 280,000 490,000 175,000 Supervisor salary 65,000 Sales commissions 140,000 Shipping 154,000 Administrative salaries 210,000 Depreciation-Office equipment 35,000 Insurance 20,000 Office rent 36,000 Income 1,195,000 1. Compute total variable cost per unit. 2. Compute total fixed costs. 3. Prepare a flexible budget at activity levels of 6,000 units and 8,000 units.
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