Reference no: EM132542617

Bonanza Corporation is in the process of preparing a quarterly budget for three different levels of output(measured in units): 2,000, 2,500, and 3,000.

The product uses the following inputs:

Materials: Variable Overhead:

Three pounds of plastic @ $6.00 Inspection: 0.2 hr. @ $10

                                4 ounces of metal @ $2.00 Machining: 0.3 hr. @ $5

Labor: Fixed Overhead:   0.5 hr. @ $10.00 Rent: $15,000 per quarter

Utilities $3,000 per quarter

Required:

Question 1: make a budget for the three levels of output measured in units.

Variable Range of Production (units)

Production Costs Cost/Unit 2,000 2,500 3,000

Direct materials (Variable)

Direct labor (Variable)

Inspection (Variable)

Machining (Variable)

Total Variable Costs

Rent (Fixed)

Utilities (Fixed)

Total Fixed Costs

Total Production Costs