Hello, I am confused on how to solve this problem, specifically, how to create a static budget and flexible budget. Could you help?

Hello, I am confused on how to solve this problem, specifically, how to create a static budget and flexible budget. Could you help?

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ABC Corp produces alphabet flash cards for grammar schools.
They forecast that they
will need to produce 90,000 sets of cards for the 2006-2007 school year.
They budget the
following costs for each set of cards.
Cost per set
Materials (1/2 pounds cardboard @ $1.5 per pound)
$
.75
Labor (1/4 hour @ $10 per hour)
$ 2.50
Variable overheads (1/4 hour @ $5 per hour)
$ 1.25
Fixed Overhead
$21,000
Actual results for the academic year were:
Production
80,000 sets of cards
Materials purchased and used
38000 pounds @ 1.3 per pound
Actual labor
23,000 hours costing $245,000
Actual Variable Overhead
$130,000
Actual Fixed Overhead
$22,000
Required: 1. Prepare an analysis that shows the Volume Variance and the Flex Variance
using per unit costs and a static budget, a flexible budget and actual costs.
2. Compute Material Price and Quantity Variances
3. Compute the Labor Rate and Efficiency Variances

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